The Ministry of Finance says the newly approved COVID-19 Health levy which will see the VAT Flat rate as well the National Health Insurance Levy adjusted upwards, will not be used for paying the free water and electricity given to the public in 2020.
A statement issued by the Public Relations Unit of the Ministry says the claims as being perceived by the public is inaccurate.
The Minister of Information, Kojo Oppong Nkrumah in a recent statement indicated that government’s proposed new taxes are to help address the huge fiscal gap created as a result of government’s COVID-19 expenses.
He said government spent about 19 billion cedis of borrowed funds to provide free water and free electricity among other expenses to fight the COVID-19 pandemic and that amount must be repaid.
But the Finance Ministry in its statement clarified what the minister insinuated.
The statement also noted media reports suggesting that government has announced that the COVID-19 levy is to be utilized in paying for free water and electricity of 2020. Again, the Finance Ministry said this was not true.
The Statement from the Finance Ministry clarified that Mr Oppong Nkrumah’s comment to the effect that COVID-19 expenses include water and electricity ought not to be misconstrued to mean the new taxes of 2021 are direct charge for those services.
The Ministry also denied media reports suggesting that government has so far spent GHS 1.7 billion on the COVID-19 pandemic.
It explained that the said GHS 1.7 million highlights expenditures on only two items under the COVID-19 related programmes namely, COVID-19 Alleviation Programme 1 (CAP1) and Emergency Preparedness and Response Plan 1.
Other COVID-19 expenditures were COVID-19 Alleviation Programme 2 (CAP2), COVID-19 Preparedness Plan 2, Provision of Health Infrastructure, Seed Fund Capitalization of Development Bank, among others.
