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Gov’t increasing VAT by 2.5% means it doesn’t care about rising inflation

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“Mr. Speaker, we will undertake the following actions, initiatives, and interventions under the seven-point agenda. To aggressively mobilize domestic revenue, we will among others: Increase the VAT rate by 2.5 percent to directly support our roads and digitalization agenda; Fast-track the implementation of the Unified Property Rate Platform programme in 2023; and Review the E-Levy Act and more specifically, reduce the headline rate from 1.5% to one percent (1%) of the transaction value as well as the removal of the daily threshold,” the Minister of Finance, Ken Ofori Atta said at the reading of the 2023 Budget Statement and Financial Policy.

Dominic Anarigide, the Deputy Constituency Secretary for the NDC in Navrongo explained that the increase in VAT by the governmenr suggests that the government is not too concerned about the rising inflation rates in Ghana.

The Upper East Region recorded the overall second highest inflation for the month of October, 2022. This is according to the Ghana Statistical Service’s Consumer Price Index for October 2022.

The Region recorded an overall inflation rate of 33.6 percent. The North East Region followed closely with an inflation rate of 33.1 percent. The Northern Region was fourth among the 5 regions of the north with an inflation rate of 27.3 percent while the Upper West Region recorded an inflation rate of 27 percent for the month of October.

The region with the highest overall highest inflation rate in northern Ghana was the Savannah Region with a rate of 47.6 percent.

For food inflation, Savannah Region topped with 49.7 percent while the Upper West Region followed with a rate of 44.4 percent. The North East Region came in close third with a rate of 36.6 percent. The Upper East Region and the Northern Region recorded food inflation rates of 34.9 percent and 28.2 percent respectively.

32.9 percent was the inflation rate for the non-food basket for the Upper East Region.

Meanwhile, Ghana’s year-on-year inflation rose to 40.4 per cent in October from 37.2 per cent in September, the Ghana Statistical Service (GSS) has announced.

Inflation, could be worse, according to Mr. Anarigide.

“Increasing VAT by 2.5% is like saying that government doesn’t care about the hikes in inflation and the excruciating pain it’s causing the ordinary Ghanaian. Let’s tighten our belts harder for next year,” he wrote of his Facebook page.

Ahead of the Budget reading, he wrote, “the current inflation rate of 40.4% is already causing excruciating pain to the ordinary Ghanaian as many are battling with high cost of living and poor living conditions. The budget should should at least give us some glimmer of hope for next year. I expect expenditure cuts and reduced government size to free some resources and restore economic stability.”

Source: A1radioonline.com|101.1MHz|Mark Kwasi Ahumah Smith|Ghana

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