Government has been advised that if it is concerned about becoming unpopular over the Communication Service Tax (CST), it should desist from its implementation.
Speaking on Newsfile on Joy FM/MultiTV, Vice President of policy think tank Imani Africa, Kofi Bentil, said it is unfair for the government to direct telcos on how to implement the CST.
“Communications Ministry doesn’t have the right to tell the telcos how to do their accounting. They don't have the right in law to tell the telcos to absorb a tax that is supposed to be passed on by law,” he stated.
The mobile telecommunication companies began an upfront deduction of the 9% tax from credit recharges from October 1, 2019, after the government increased it from 6% to 9%.
The Communication Ministry believes the tax should be deducted when consumers make use of services, like when they make calls or use data.
The Minister of Communication, Ursula Owusu-Ekuful, have said mobile telecommunication companies’ “unprecedented” mode of implementing the Communication Service Tax (CST) is making the government unpopular.
However, Kofi Bentil believes the government has no right to tell the telcos what to do but it is the prerogative of the telcos to decide how they want the tax deducted.
“If you don’t want to be unpopular because of taxation, don’t tax people,” he told Samson Lardi, host of the show, Saturday.
Kofi Bentil said that the Communication Ministry’s imposition on telecommunications on how to handle the CST is “totally improper”.
“Even if telcos decide to absorb the tax, I hold the view that they have a right to inform their users that ‘this tax has been levied on you but we have decided to take it’,” he added.
The Vice President of Imani Africa said that the government should be free to charge their taxes, however, it must have the courage to tell people why they are doing so.
He stated that on the issue of using the tax to combat cybercrime, he believes the government cannot provide better cybersecurity for banks and telcos than what these companies are providing for themselves.