The VAT on financial services would not take effect from tomorrow, July 01 as initially planned.

The 17.5% tax on selected banking  and other financial services including closure of accounts, online banking, mobile banking and sale of cheque leaflet among others has now been put on hold until further notice.

The Ghana Revenue Authority has confirmed it in an official statement saying it is to allow more time for public education on the programme and adequate preparation by the banks for a smooth implementation.

Below is the full statement:

After a careful evaluation of progress of the ongoing publicity and education programme on VAT on financial services, and taking cognizance of the request by sections of the banking community for extension of the period of preparation for implementation of the tax, the commencement date of 1^st July, 2014 originally set, has been postponed until further notice.

The decision, taken in consultation with the appropriate stakeholders is to allow for more education of the general public and adequate lead time for the banks to achieve the level of preparedness that will ensure a hitch-free implementation.