Ghana’s organised labour sets to protest 15% VAT on electricity

The organised labour movement is set to embark on a nationwide demonstration against the Ghanaian government’s imposition of a 15% value-added tax on electricity.

According to Ghanaweb, the labour groups have issued the government a two-week ultimatum to withdraw the controversial tax, but the directive to the power distributors remains.

Dr Anthony Yaw Baah, Ghana’s Secretary-General of the Trade Unions Congress, announced on Friday that the nationwide protest will begin on February 13.

“In our earlier statement, we said if by the 31st of January 2024, the government had not withdrawn its directive, we would advise ourselves,” Baah said.

“So, this afternoon, we’ve met here, and we’ve advised ourselves. It is that advice that we will communicate to the president. Our advice is straightforward. 

“We have advised ourselves that this government is taking us for granted, so we are going to lead massive demonstrations in all the 16 regional capitals of Ghana on 13th February.”

In January 2024, TUC issued a seven-day ultimatum to the government to withdraw the imposition of Value Added Tax (VAT) on electricity consumption above the lifeline.

At an earlier press conference on January 23, Baah said, “It’s always the poor people in this country, including pensioners, who bear the brunt. And we should not allow that to continue. Organised Labour, we have come together and our message to the government is very simple, we cannot pay VAT on electricity.”

“We will not pay it today or tomorrow. Organised Labour is demanding the immediate withdrawal of the letter, and another directive from the Finance Minister to Ghana Grid Company (GRIDCo), ECG to stop the implementation of the VAT on electricity. We are giving the government, up to January 31, 2024, to withdraw the letter.” 

In the meantime, the government said it has planned to hold an extensive dialogue with Organised Labour and other crucial stakeholders in the coming weeks on the VAT on electricity.

The stakeholder dialogue, as stated by the Finance Ministry in its statement dated January 30, 2024, is designed to ensure the workers accept the new electricity tax.

“The Ministry of Finance has noted the concerns of Organised Labour on the implementation of VAT on the consumption of electricity by residential customers. Extensive dialogue will be held with Organised Labour and other key stakeholders in the coming weeks, to ensure stakeholder buy-in,” the Ministry said in its statement.