Editor-in-chief of the New Crusading Guide Newspaper has lashed out at former National Organiser of the National Democratic Congress Yaw Boateng Gyan, for placing a perpetual injunction on the president not to consider, let alone implement a decision to increase Value Added Tax (VAT).
Although the government has denied speculations that it plans to increase the tax from 17.5% to 21%, Mr Gyan said he was baffled that the president even considered increasing it when he openly campaigned against its introduction in 1995.
President Akufo-Addo, then Member of Parliament of Abuakwa South, together with some member and sympathizers of the opposition New Patriotic Party in 1995 staged a massive demonstration against the Rawlings administration over its plan to introduce VAT.
The ‘Kume preko’ demonstration, the largest in Ghana’s history, was in protest against the high cost of living and the then government’s decision to introduce VAT.
The Alliance for Change (AFC) protestors with Akufo-Addo as spokesperson believed the VAT overburdened Ghanaians who were already struggling to get by. The demonstration hit home, compelling government to repeal the tax just three months after it was enforced.
It was eventually revised and reintroduced in 1998.
Mr Gyan is baffled that the president, who protested vehemently against the introduction of that tax on the premise that it would overburden Ghanaians, is now considering and possibly increase it.
Yaw Boateng Gyan says the president cannot increase VAT when he was against it
Speaking on Peace FM's Kokrokoo, Boateng Gyan argued that if the president really cared for the people, the first thing he would have done, after promising to abolish nuisance tax during his 2016 campaign, would have been to remove VAT completely when he assumed office and not seek to increase it.
If it was a bad thing, then they should have scrapped it but it is surprising that they rather want to increase it. The situation now and when they embarked on the demonstration is not different, so why have they taken this decision, he queried in Twi.
He, however, said since the alleged increase was a mere rumour, it will be prudent to wait for the Finance Minister to present the budget on Thursday before further comments can be made on the issue.
But Kweku Baako finds his comments unfortunate. He said the AFC and Akufo-Addo were not, in principle, against the introduction of VAT.
Their fear, he explained, was that the government had not demonstrated that it was capable of handling the tax and that might result in corruption and the misuse of resources.
If Akufo-Addo was against VAT, he would not have agreed to a 2.5% increase – from 10% to 12.5% - in 2000 to fund the Ghana Education Trust Fund (GETFund), he said.
He indicated that subsequent increases have all been unanimously agreed to and passed in Parliament, “so we have gone past that stage where people put a personal liability on president Akufo-Addo that because of his membership of the AFC, he is not entitled to be part of any regime that increases VAT.”
He continued, “When they reintroduced VAT in 1998 despite our opposition, did we go on a demonstration, in 2000 when they increased it from 10% to 12.5%, did we go on a demonstration? When it moved to 15% what did we do? When it moved 17.5 percent what did we do?
“The dynamics had changed, there had been a greater and deeper understanding of VAT. There had been a certain general acceptance of VAT as a tax policy,” he said.
The veteran journalist and sympathiser of the governing New Patriotic Party said those who have remained on that static mode, relative to incidents that occurred in 1995, are “being totally unrealistic and not pragmatic.”
He said the theory that Akufo-Addo cannot increase VAT because of his stance in 1998 is unsustainable and cannot be used in any serious scientific analysis.
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