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Ghana New Tax Law Parliament to grill Terkper over suspended 1% tax on interests

The Speaker of Parliament Rt. Edward Doe Adjaho has summoned the Minister of Finance Seth Terkper into the chamber over misinformation of the public that the 1% tax on interests had been suspended.

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Rt. Hon Edward Doe Adjaho, Speaker of Parliament, Rep. of Ghana play

Rt. Hon Edward Doe Adjaho, Speaker of Parliament, Rep. of Ghana

The Speaker, expressed displeasure over the fact that the Ministry took the unilateral decision to announce a suspension of the 1% withholding tax on investments without approval from parliament. 

Buttressing the position of the speaker, MP for Old Tafo, Dr. Akoto Osei said the Ministry of Finance and the Ghana Revenue Authority do not have any power to suspend the tax.

" Mr. Speaker, this is unlawful, and parliament must respond emphatically. As we speak the so- called suspension of the 1% Withholding Tax can not be implemented, because no parliamentary approval has been acquired"

The new Tax Law, which took effect on  January 1, 2016, imposed more taxes on income of locals and foreigners, prompting public backlash over the additional 1% withholding tax imposed on returns on investments.

Read More: > Reversal 1% withholding tax on interest suspended
The criticisms grew so intense that the Ministry of Finance decided to suspend the imposition on the investment incomes.

However, subsequent information reaching Pulse Business revealed that the Ministry did not send any proposal to parliament.

“We wish to bring to the attention that government has submitted proposals to Parliament for amendment of the relevant sections of the Income Tax Act 2015 (Act 896) to reverse the imposition of 1 percent withholding tax on interest earned by individuals.

“In this regard, financial institutions are directed to suspend the imposition of 1 percent withholding tax on interest earned by individuals,”
the Finance Ministry said.
Ghana new tax law GRA in contempt of Parliament over 1% tax scrap

Later reports however revealed that the Ministry of Finance had not submitted any proposal to parliament, prompting the agitations from the Speaker of Parliament and MPs.

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