Deputy Finance Minister, Cassiel Ato Forson has countered ongoing reports in the media that the government intends to tax pensioners.
Reports went viral that the government is putting some measures in place to tax pensions of Ghanaians in the new tax law.
This followed comments passed by the Finance Minister, Seth Terkper during an interview he granted on the sideline of a business summit in Accra.
The report sparked an uproar in the public domain, prompting the Pensioners Association to register their displeasure.
Its General Secretary, Edward Ameyibo said they were not consulted in the decision making process, adding it will be “unfair because in the first place, our pensions keep running down because of inflation”, hence it will not be fair for the government to tax them.
Clarifying the situation, however, Mr. Ato Forson told Multimedia’s Kojo Yankson on the Super Morning Show that “the new income tax laws exempt pensioners” because “pensions in this country are not taxable.”
According to him, what Mr Seth Tekper said at the business summit was misconstrued by many hence the confusion.
“A question was posed to him [Seth Tekper], on the issue of avoidance and the issue of what countries do, he answered by saying that other countries taxed pension savings, he went further to explain that indeed some individuals sometimes going at the back of avoidance because some countries fail to tax pensions, they move some of their income from income to pension savings and for that matter they avoid taxes of those income. He further said that other countries even tax the employers contribution to pension saving in the case of Ghana Social Security but for us, our laws- the new income tax law act…, are not taxable, we do not tax pensions in Ghana and we do not have intentions to tax pensions in Ghana.”
On the allowances of workers, the deputy finance minister said, the only thing the new tax seeks to do is to broaden the band and make the whole thing “tax friendlier”, adding that those allowances are already in existence since year 2000 and all the finance ministry seeks to do is not to tax new allowances because that is not the “position of the ministry”
Meanwhile the public relations department of the finance ministry has already issued a statement to further clarify the issue.
Source: GhanaWeb
