Economist and senior lecturer at the University of Ghana, Dr. Adu Owusu Sarkodie, has advised the government to retain the COVID-19 Levy rather than abolish it, suggesting a name change instead.
Speaking on Asempa FM’s Ekosii Sen show, he argued that the levy has been a significant source of revenue for the government, generating about GH₵2.2 billion, which helps finance approximately 70% of the Free Senior High School (Free SHS) policy.
“The COVID-19 tax has brought in more money than all other taxes. Instead of scrapping it, they should rename it to something health-related and continue using it,” he suggested.
Dr. Sarkodie further proposed that part of the revenue from the tax could be allocated to the National Health Insurance Scheme (NHIS) and the development of healthcare facilities.
“If we maintain it, we can channel some of the funds into NHIS and improving health infrastructure. It will help the country in the long run,” he added.
His comments follow the government’s announcement that the COVID-19 Levy will be abolished by the end of the year.
Finance Minister Dr. Cassiel Ato Forson made this known during the presentation of the 2025 Budget Statement and Economic Policy on March 11.
Dr. Forson also highlighted concerns over the country’s current VAT structure, explaining that the 15% VAT rate is compounded by other levies, including the 2.5% GETFund Levy, 2.5% National Health Insurance Levy (NHIL), and the 1% COVID-19 Levy, effectively raising the VAT rate to about 22%.
“This is because GETFund Levy, NHIL, and the COVID-19 Levy are all added to the base for the final determination of VAT,” he stated.
The Minister lamented that businesses are “not permitted by law to claim their input for NHIL, GETFund Levy, and COVID-19 Levy,” which increases the financial burden on households.
As part of ongoing tax reforms, Dr. Forson assured that changes to the VAT system will be completed this year.
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