CST: ‘Withdraw your illegal order to telcos’ – Ato Forson to Ursula

The ranking member of Parliament’s finance committee, Cassiel Ato Forson is challenging the communication minister’s authority to order telcos to halt upfront deductions of the Communication Service Tax, CST.

Ursula Owusu-Ekuful on Friday ordered the telcos to immediately halt the upfront deductions. She directed that the CST be treated the same way as VAT, NHIL, GETFUND and all other levies imposed on entities doing business in Ghana.

She said the directive is to reduce the negative impact of the CST on Ghanaians.

Mrs Owusu-Ekuful has also warned the telcos that failure to comply with the directive will result in sanctions.

But the NDC MP, Casiel Ato Forson says the minister has no power to issue such administrative orders on how a tax policy should be implemented.

In a letter addressed to her, Mr Ato Forson said “I would like to point out that: (i) under the Revenue Administration Act 2009 (Act 791), the administration and management of tax revenues reside in the in the Ghana Revenue Authority, and (ii) the CST Act 2019 does not apply the principles of the Value Added Tax (VAT) Act 2013 (Act 870)”

He explained saying: “from the two Acts, the minister for communications does not have the powers to issue administrative orders on how a tax policy should be implemented; and secondly, the CST cannot be treated in the same way VAT is treated. The issuance of the directive is therefore, an illegal act and should be withdrawn with immediate effect”.

The Ajumako Enyan Essiam MP further said government should encourage the finance ministry to present a CST Amendment Bill to parliament for the necessary action to be taken if it wants the CST to be treated as VAT.

“it is unconscionable for the government to increase the CST but insist the telecommunication companies hide the deduction from consumers. If the government thinks the policy is making it unpopular, it should come to parliament to repeal the Act” Mr Ato Forson advised.