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Mar 8, 2019 | Business & Finance

Gov't Urged To Review Exorbitant Luxury Vehicle Levy

By Modern Ghana
Gov't Urged To Review Exorbitant Luxury Vehicle Levy

Deputy Minority Leader, James Klutse Avedzi wants the government to reduce the rate charged as luxury vehicle levy.

Last year, the government introduced a new levy on vehicles with engine capacities of 3.0 litres and above.

Vehicles with engine capacity of 2950 to 3549 capacity will pay GHS1,000 cedis, while vehicles with engine capacity of 3550 to 4049 will pay GHS1,500.

Engine capacity above 4049 will pay GHS2,000 cedis.

Already, seven associations including the Vehicle and Asset Dealers Association embarked on a demonstration to protest the luxury vehicle levy.

Speaking on Eyewitness News, Avedzi said, the government should consider a downward review of these the rates.

“That rate that is being charged is too high. From the beginning, the Government can charge a very low rate and then over the years we think that it works perfectly, then gradually the rate can be increased. To pay an amount of Ghc1500 or Ghc2000 annually in addition to your roadworthy certificate is not good at all. This will also affect the Businessmen.”

“The alternative we want is that, the rate should be looked at again. The rates are too high. If there are consultation with the market players and the and the association members whose businesses are affected by these rates, they can come to a compromise with government”, he added.

Seven groups demonstrate against luxury vehicle tax

Some seven groups demonstrated on Thursday over the luxury vehicles tax.

The General Secretary of the Vehicle and Asset Dealers Association, Nana Owusu Duodu, expressed their resolve to embark on countless protests to ensure a reversal of the levy.

“We wrote reminders to them [the government] but they didn't mind us. We held a press conference, but it was all to no avail. So the only option we had was to stage a demonstration to kick out this nuisance tax. We have three petitions, we are presenting to the Minister of Finance, Speaker of Parliament and the last to the seat of the government. If we are not seen and heard we would carry out the same demonstration across [the country],” he said

The protesters include car dealers, spare parts dealers among others from associations like the Vehicle and Asset Dealers Association (VADA), the National Concerned Spare Parts Dealers Association (NCSPDA), True Drivers Union (TDU), Concerned Drivers Association (CDA).

Govt to raise GH¢300m from tax on luxury vehicles

The government is to rake in at least 300 million cedis in revenue from taxes on luxury vehicles by the end of 2019.

Some economists are optimistic the government will meet the target since it already has a database of such vehicles.

Ranking member for the Finance Committee, Cassiel Ato Forson, however, wants the government to exclude 3.0-litre capacity luxury vehicles that are not serviceable.

“If for instance I have a car with engine capacity of 3.0 litre and above and for some strange reasons that vehicle doesn't work or is unserviceable, I am obliged by the Act to pay for this tax in spite of the range that will be set,” he argued.

After missing the revenue target by 1.4 billion cedis between January and May this year, the Finance Minister, Ken Ofori Atta sought approval from Parliament to implement some three tax policy measures.

These include; the separation of GetFund and NHIL from the VAT, charging 35 percent tax on all income above 10, 000 cedis, the introduction of a levy on luxury vehicles with engine capacity 3.0 litres and above.

Source: citinewsroom.com |Ghana

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