The Deputy Minister for Finance, John Kumah says the government is ready with measures to halt the increase in the country’s inflation rate.
Mr. Kumah said this on PM Express Business Edition Thursday. He explained that the introduction of taxes on petroleum in May, this year, resulted in the increase of prices of goods and services, thereby leaving inflation at 7.8 per cent in June, and 9 per cent in July.
“At the beginning of the year, government introduced a number of taxes which took effect from May. So as at May, the inflation rate was 7.5 per cent. But because of the introduction of petroleum, you know petroleum affects virtually everything, so the immediate reaction in the following month; June, shot it up to 7.8 per cent because transport fares had gone up. That is why as at July, you saw the figure at 9 per cent,” he told host, George Wiafe.
According to the Deputy Minister, a rise in inflation should be expected whenever new taxes are introduced, as people react to it by increasing prices.
He, therefore, called for calm, stating that there is no cause for alarm.
The Deputy Finance Minister gave the assurance that, “we have it under firm control. I can assure you. There is no cause for alarm. Some people should not be unnecessarily frightened that we are tipping points.”
Adding that, “in 2016, the inflation rate was 15 per cent but we were not at the tipping point, so if we are in single-digit inflation today, where is the tipping point? So it is firmly under control.”
He noted that in the coming month, there will be stability in the economy.
In May, the Ghana Union of Traders Associations (GUTA) disclosed that consumers will bear the consequences associated with the rising cost of fuel and costs resulting from the implementation of new taxes.
“Prices of almost every raw material have gone up, the freight charges have also gone up astronomically. If the price build-up keeps rising, then, of course, we should expect that there should be some increases in prices of goods and services”, President of the Association, Dr. Joseph Obeng had said.
For many Ghanaians, the introduction of taxes is unfortunate but government says it is required to assist in the recovery of the economy.
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