Vodafone Begins Charging The New 9% Communication Service Tax To Customers; Other Telcos To Follow Suit

Vodafone Ghana has reportedly started charging its customers the revised Communication Service Tax (CST) from this month.

The Minister of Finance, Ken Ofori-Atta, had announced in a Supplementary Budget in his Mid Year Review that there was going to be an increase in the Communication Service Tax from 6 to 9 percent.

Vodafone Ghana, in a notice to customers, formally noted that an increment was going into effect. Vodafone added that the review of the tax from 6 percent to 9 percent would reflect in customers invoice going forward.

In a notice, the telecoms operator noted that “this is to inform you that increment in the Communication Service Tax (CST) as announced in the Mid -Year Budget Review took effect from August 19.”

Background

The Communications Service Tax Act 2008, (Act 754) was established in 2018. The tax is paid by consumers of the communications service providers who in turn pay all the tax collected to the Domestic Tax Revenue Division of the Ghana Revenue Authority (GRA) on a monthly basis.

According to the Finance Ministry, the tax was raised to 9% in order to help develop the foundation for a viable technology ecosystem in the county. These include putting in systems to identify and combat cybercrime, protect users of information technology and combat money laundering and other financial crimes.

Vodafone Ghana is the first telecom to fully comply with the tax increase with some other telcos agreeing to abide by the new changes, although there has been no timeline to when their increases will take effect.

Update

From October 1, 2019, all Telecom firms will begin charging its customers the revised Communication Service Tax (CST) from October 1, 2019. The Ghana Chamber of Telecommunications made this announcement on Friday, 20 September 2019.

The Chamber in a statement issued said, “The Ghana Chamber of Telecommunications on behalf of its members – AirtelTigo, MTN and Vodafone – wishes to notify its esteemed customers and the general public of the increase in Communication Service Tax. As intended, the incidence of the modification will thus be on consumers. It will impact the cost of telecommunication services.”