President Akufo-Addo says, although government is adopting strict measures to revive the Ghanaian economy, the salaries of public sector workers will not stay the same for the next four years.
His comment is in response to concerns raised by public sector workers about the delay in reviewing their salaries upward amid increased and newly introduced taxes.
Speaking at the 11th Quadrennial Delegates Congress of the Trades Union Congress in Kumasi, President Akufo-Addo assured that “salary increments for public sector works have not been frozen for the next four years”.
“The truth of the matter is that, we are not in normal times, and we are appealing to all Ghanaians including organised labour to assist the government in this endeavour to help rebuild our public finances and economy,” he added.
The President also acknowledged the concerns some Ghanaians had with some of the new policies outlined in the 2021 budget.
“This [budget] statement appears to contain some difficult but very necessary set of action as evidenced by reactions from some quarters.”
President Akufo-Addo added: “I understand the concerns being expressed especially with regard to the imposition of some new taxes [introduced].”
Taxes introduced
The 2021 budget, which is themed “Economic Revitalisation through Completion, Consolidation & Continuity”, seeks to carefully balance fiscal consolidation and facilitate the recovery of our economy following the pandemic.
Some of the proposed taxes in the budget were widely criticised by observers and various stakeholders.
Direct tax measures in the budget included a 5 percent financial sector clean-up levy, the 30 percent income tax rebates for companies operating in the hospitality, among others, the suspension of instalment income tax stamp and vehicle income tax payments from April to December 2021, the extending of the exemption of income tax on capital gains made from the realisation of securities listed on the Ghana Stock Exchange beyond 2021.
But the indirect tax measures courted more controversy with concerns about the price of fuel, among others, after the proposed a 5.7 percent increment in prices of petrol and diesel as part of new levies.
The increment will be as a result of the new 10-pesewa Sanitation and Pollution Levy as well as a 20-pesewa levy to cater for charges on the country’s excess power capacity.
There was also a 1 percent COVID-19 levy which will be a one percentage point increase on both the existing VAT Flat Rate Scheme (VFRS) and National Health Insurance Levy (NHIL).
