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Here is why the 9% Communication Service Tax is deducted immediately you load credit

On October 1, 2019, the 3% increase in the Communication Service Tax (CST) was implemented.

Telcos in Ghana

This was after it was announced by the Finance Minister in Parliament when he read the mid-year budget in July 2019.

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Before consumers started paying for the CST a few days ago, the telecommunication companies were absorbing it since its introduction.

In 2018, VAT realignment was done. A 5% levy was added to the numerous taxes telcos pay already.

In July 2019, when the Finance Minister Ken Ofori-Atta read the mid-year budget review, CST was increased from 6% to 9%.

The telcos were absorbing the 6% but the argued that they would pass the entire 9% to the subscribers since they were already saddled with several taxes,

When the telcos were absorbing the 6% CST, they were paying upfront.

This implied that now that the entire 9% has been passed on to the subscribers, it has to be paid upfront.

This explains why the CST is deducted the moment you load credit even before you use it.

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