The Minister of Finance, Ken Ofori-Atta, has announced that government employment will be frozen beginning next year.
According to him, there will be a moratorium on civil and public service recruitment beginning in January 2023.
This was stated by him during the ongoing budget presentation at Parliament House in Accra.
“From January 2023, there will be a hiring freeze for civil and public servants.” A reduction in appointment spending, including salary freezes, as well as the suspension of certain allowances such as housing, utilities, and clothing.”
In addition, the Minister announced a 2.5% increase in VAT.
Except for supplies made by a wholesaler or retailer of goods, which are taxed at a total flat rate of 3%, the standard VAT rate is 12.5%.
Meanwhile, Mr Ofori-Atta has revealed that the government will reduce the contentious and onerous Electronic Transactions Levy (E-Levy) from 1.5% to 1% and lower the threshold from GHC 100 per transaction.
According to him, the move is one of several initiatives that the government intends to implement in order to turn the economy around and alleviate the severe economic hardship that Ghanaians are currently experiencing.
The tax, which many analysts have described as regressive, was expected to raise at least GH6.9 billion, but the figure had to be revised to around GH4.9 billion due to the delay in the passage of the e-levy bill. After failing to meet the GH1.46 billion target for the first half of the year, the government was forced to reduce the tax measure to GH611 million.
Furthermore, the Ghana Revenue Authority (GRA) has disclosed that the e-levy has generated 328 million cedis (GH328m) so far.
This announcement came after the just ended 2023 budget reading by the Minster which the Minority and most Ghanaians are not in favor of.
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