Here is why the 9% Communication Service Tax is deducted immediately you load credit

October 4, 2019 2:02 PM

On October 1, 2019, the 3% increase in the Communication Service Tax (CST) was implemented.

Telcos in Ghana

This was after it was announced by the Finance Minister in Parliament when he read the mid-year budget in July 2019.

Before consumers started paying for the CST a few days ago, the telecommunication companies were absorbing it since its introduction.

In 2018, VAT realignment was done. A 5% levy was added to the numerous taxes telcos pay already.

In July 2019, when the Finance Minister Ken Ofori-Atta read the mid-year budget review, CST was increased from 6% to 9%.

The telcos were absorbing the 6% but the argued that they would pass the entire 9% to the subscribers since they were already saddled with several taxes,

When the telcos were absorbing the 6% CST, they were paying upfront.

This implied that now that the entire 9% has been passed on to the subscribers, it has to be paid upfront.

This explains why the CST is deducted the moment you load credit even before you use it.

Magdalene Teiko Larnyoh A feminist at heart and a lover of art. She loves to write on business, politics and health.

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