More talk tax money for youth employment

Cabinet has approved more money from the Communications Service Tax, known as ‘talk tax’ to be allocated to the National Youth Employment Programme (NYEP) for the payment of allowances, the Daily Graphic has reported.

According to the report carried in the Thursday August 26 issue of the newspaper, Cabinet approved an increase from 20% to 60%.

The Daily Graphic citing a highly placed source at the NYEP Secretariat said following the approval the increment and payment would be effected by the Ministry of Finance and Economic Planning.

When the government introduced the tax in 2008, there was stiff opposition from politicians and some ordinary Ghanaians.

During the debate to debate the motion in Parliament, Alban Bagbin, the then Minority Leader argued that the ‘Talk Tax’ was an inhibition to freedom of speech, and the Deputy Minority Leader and Member of Parliament (MP) for Avenor Ave, Edward Doe-Adjaho said the NDC would reverse the new levy as soon as it came back to power.

Other arguments cited a World Bank survey which revealed that the proposed tax system was had negative implications, as it was counterproductive and would ultimately erode the economic gains that the country has made in the last seven years before the introduction of the tax.

For instance the  Coalition of NGOs in the Water and Sanitation sector (CONIWAS) has called on the government of Ghana to use 25% of the talk tax levied on mobile phone subscribers and 5% of the National Health Insurance levy to finance water, sanitation and hygiene services in the country.

The collecting agency, the Value Added Tax (VAT) Service set a collection target of GH¢855.35 million for 2009.

By Emmanuel K. Dogbevi