The telecommunication companies are currently in a crunch meeting to come out with an official stance on government’s directive on the upfront deductions of the Communications Service Tax (CST).

The meeting by the Chamber of Telecommunications is also to consider the directive on the roll over of data.

Since October 1, 2019,  Mobile Telecommunication Companies have been charging 9% on every data purchased by customers following an increase in the CST from 6 to 9% announced by the Minister of Finance during the Mid-Year Budget Review.

Per every GH¢1 of recharge data purchased,  9% CST tax is deducted, leaving the customer with  0.93 of the data purchased.

This has  been received with a  public backlash with the Ministry of Communication directing that the direct deductions should be stopped.

Image result for Telcos meet over government's directive on Communications Service Tax
Minister of Communications, Ursula Owusu.

The Minister of Communications, Ursula Owusu at the Meet-The-Press Series yesterday (October 15) directed that henceforth the CST should not be deducted upfront.

Instead, it should be done just as VAT, NHIL and GETFUND levies.

She also added that all unused data purchased must be rolled over and threatened the revocation of licenses if the Telcos fail to do so.

The Telcos have been silent on the matter but are expected to give their stance after the crunch meeting which will end soon.

Meanwhile, a  tax analyst , Dr. Ibrahim Bedi has warned of an imminent collapse of the Telecommunications industry and its attendant job losses if Telcos fail to comply with indirect CST deductions as directed by government.

He, however, believes the current direct CST deductions by the Telecos are legal.

Dr Bedi said extensive stakeholder engagement is the best way to resolve the issue amicably before it gets out of hand.

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