The controversial Covid-19 Health Levy generated over GH¢1 billion (GH¢1,092,812,056) for the government, in the first half of 2024, outperforming the e-levy by GH¢282.3 million during the same period.
The levy was introduced following the outbreak of corona virus, to raise funds to deal with the impacts of the pandemic, which peaked in 2020. Four years on, the levy remains in force despite ongoing calls by businesses for its removal.
But here is a possible reason why this levy has stayed, despite the persistent opposition. It is giving government additional revenue of over GH¢1.09 billion, while an equally controversial and much touted e-levy raked in a little over GH¢800 million. The over GH¢1billion raised even fell short of government’s target for the first half of the year by some 22.6%. Government had hoped to raise over GH¢1.4 billion by June, but fell short by over GH¢320 million. In the entire year, it is government’s target to mobilise over GH¢3.17 billion from the covid-19 levy.
Given the pressure on the government to boost domestic revenue, especially under the International Monetary Fund (IMF) programme, and its own desire to accomplish a number of projects to better its chances at the December elections, dropping the covid-19 levy appears not to be an option for government.
Parliament enacted the COVID–19 Health Recovery Levy, 2021 (Act 1068) to impose a special levy on the supply of goods and services as well as imports, to raise revenue to support the COVID–19 expenditures and other related matters. The levy is charged at a rate of 1% calculated on the value of taxable supply of goods and services made in Ghana, as well as import of goods and services into Ghana but excluding exempt goods or services. It is applicable to both Standard Rate and VAT Flat Rate registered persons.
The opposition National Democratic Congress (NDC) has indicated that it will scrap the levy if it comes to power.
