Story: Albert Amekudzi
A SURPRISE increment of 2.5 per cent in Value Added Tax (VAT) in Parliament, which now stands at 15 per cent, has led to a heated argument between Majority and Minority Members of Parliament (MPs) and a subsequent walkout by the latter.
The Minority Leader Osei Kyei Mensah-Bonsu accused the majority side of ?smuggling? in the increment during the consideration stage of the VAT and using their numbers to force their way through.
During the consideration stage of the bill on Friday November 15, 2013, a Deputy Finance Minister, Cassiel Ato Baah Forson moved for amendments to add 2.5% to the existing 12.5% to be passed as law.
This proposed amendment led to the heated argument between Minority Leader Mensah-Bonsu and Majority Leader Dr. Kunbuor because, according to the Minority Leader, that amendment was not included in the memorandum of the bill.
Mr. Mensah-Bonsu accused the minister and the majority side of ?smuggling? the 2.5% increment in the middle of the consideration stage and added that it was a ?nocturnal conspiracy to up the threshold of the VAT.?
He further pointed out that the move to increase the threshold was a major policy matter and thus ?we should have amendment to the memorandum which is not being done,? and noted that the amendment was to consolidate the law relating to VAT and not to increase the threshold.
The Minority Leader questioned the policy drive, the principle underpinning the introduction, ?what are the defects of the existing regime as the constitution says we should do? We are not told, what are the remedies and the urging necessities for the increment??
He added that it was dangerous for the country to up its threshold and stated that if government wanted to increase the threshold, it ought to be done in the proper manner and given very good reasons.
But the majority leader disagreed and noted that the increment was not a major policy issue for the government because ?what are major policy issues are contained in the memorandum? of the bill.
The heated exchanges led to a walkout by the minority who later addressed the press. The Minority Leader speaking to the press stated that their decision to ?wash its hands off? the approval of the increment was not only because of the haphazard manner it was introduced on the floor but the undue hardship the increment would bring to Ghanaians.
He explained that the bill had been before the House since July 2013 but the government never gave any notice of imposing an increment throughout the consultation and consideration stages of the bill until it was near approval.
The minority leader stated that government was supposed to introduce the increment appropriately and allow some debate from the members and the general public before any motion could be moved for approval.
Mr. Mensah-Bonsu further noted that the second deputy Speaker, Ebo Barton Oduro did not allow some debate on the increment in the House when Mr. Forson moved for the amendments but decided to put the question for approval.
The MP for Sekondi, Papa Owusu Ankomah on his part said the Finance Committee was not privileged to the increment for discussion and to further engage civil society organizations before they were forced to accept it.
But Dr. Kunbuor said Ghana is one of the countries with the least VAT rates and added that it was imperative to increase the rates to generate more revenue for the state.
While the minority MPs walked out of the House, the Majority side remained in the chamber and passed the bill.
The VAT bill seeks to pool together, harmonize and consolidate the administrative provisions in the tax legislation of the erstwhile revenue agencies into a revenue administration Act.
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