Gov’t reduces CST from 9 to 5%

President Akufo-Addo has reduced the Communication Service Tax (CST) by 4 percentage points from 9% to 5%.

This was disclosed by the Minister for Finance, Ken Ofori-Atta during the mid-year budget review and supplementary estimates on Thursday, July 23, 2020.

According to Mr. Ofori-Atta, “in the short term, we will reduce the CST from 9% to 5% to reduce the cost of communication services to the consumer as more and more people work remotely and utilize online services. We hope we can count on the Telcos to also match this reduction in the CST by reducing their tariffs” he said.

The CST was introduced in 2008 at an ad valorem rate of six percent. The tax is levied on charges payable by consumers for the use of communication services. In 2019, it was increased from 6% to 9% to enable government get a fiscal space to create a viable technology ecosystem to among other things identify and combat cybercrime in the country.

However, government has taken steps to reduce it from 9% to 6%. This the Finance Minister mentioned that in line with the government digitization agenda, reducing the CST to 5% will help reduce the cost of communication services to consumers and to further speed up the digitalization effort where every citizen nationwide has access to the internet and other digital services.