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Gov’t imposes tax on luxury vehicles

Finance Minister Ken Ofori-Atta said that the government intends to intensify tax compliance measures to make sure that they collect all taxes due the state.

He said that based “on the under-performance for the first five months of 2018, we will end the year with an estimated deficit of 4.9% of GDP compared to the programmed target of 4.5%, resulting in a fiscal gap of GHs870 million, unless we immediately implement some fiscal measures; intensive tax compliance measures, New revenue measures, Intensive Conversion of NHIL (2.5%) to a straight levy, Conversion of GETFund VAT rate of 2.5% to a straight levy, Imposition of luxury vehicle tax of GH¢1,000-GH¢2,000 on non-commercial vehicles with capacity of 3.0 litres and above, review of PIT to include an additional band of GH¢10,000 and above per month at a rate of 35% and downward adjustment discretionary expenditures.”

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He added that "the levy will be paid on first registration and subsequently at annual renewal. Commercial vehicles will be exempted."

He however stated that the government has not increased VAT as speculated ahead of the presentation of the review.

He said that the government intends to intensify tax compliance measures to make sure that they collect all taxes due the state.

He said that the government “will ensure tax compliance and plug existing leakages.”

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The minister said external factors can be blamed for the increasing depreciation of the cedi.

“In spite of all the strong fundamentals, we have seen the cedi come under pressure. This is primarily due to external pressures. In spite of the challenges, we have put the right measures in places to make sure that we have a robust economy. The cumulative rate of depreciation of the cedi from January to June 2018 is 2.4% as against 17.2% in 2012.”

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