VAT on electricity: ICU questions govt’s late engagement with Labour

VAT on electricity: ICU questions govt’s late engagement with Labour

The Industrial and Commercial Workers Union (ICU) has described the government's decision to engage Organised Labour on the introduction of 15 per cent value added tax (VAT) on electricity as too late.


It questioned why the government did not engage labour before coming out with a letter asking the power distribution companies to begin the implementation of the VAT on electricity, but only requested to engage when labour raised concerns.

"Why didn't they talk about engagement before coming out with the letter? Do you go and spoil things, muddy the waters and when people are expressing concern you are talking about engagement?" the General Secretary of the ICU, Morgan Ayawine, said during an interaction with journalists in Accra.


He said there were laws in the country, and cited the Constitution, the Labour Law and even conventions, among others, as critical material that must guide the actions of leadership in pursuing drastic actions that affect the ordinary people.

For unions, he said, engagement had been a key tool, stressing that it was the reason government needed to do that before coming out with the VAT on electricity directive.

"We have not been talking about engagement today; engagement has been part of our operational words, and it is this that has ensured industrial peace and harmony," he said.

Mr Ayawine wondered what the engagement would be about, and asked whether it was to reduce the 15 per cent or scrap the tax.

"Are we complaining about the high level of the 15 per cent?

That is not our issue.

 If you are engaging and want to have our buy-in, it means we have earlier complained about the high level of the 15 per cent.

But that is not the matter," he said, adding that "what's the sense about this engagement? 

It's too late."


Mr Ayawine said the leadership intended to send circulars to its membership, namely companies and industries, in readiness for the demonstration on February 13, 2024.

He said it was its responsibility to get all workers ready for action.

"We are forming a task force that will visit the companies to make sure that all our members get involved in this," he said, adding that the issue should not be matters of the union alone since it affected everybody.

He said business people, employers and those in the informal sector should all be part of it because it was an issue that affected their common interest.

"We are going to make sure that all our members nationwide get involved in this exercise," he emphasised.


Last Friday, members of Organised Labour said they would lay down their tools on February 13 this year to demonstrate against the government's enforcement of a 15 per cent VAT on residential electricity consumption.

The Secretary-General of the Trades Union Congress (TUC), Dr Yaw Baah, told the press that the decision was taken by the leadership of Organised Labour during a closed-door session.

The decision to demonstrate, he said, was necessary due to the government's failure to address their grievances regarding the imposition of VAT on electricity usage.

As a result, he called on all workers in the country to begin to wear red to work from today to send a signal to the government that they would not compromise till the government dropped the decision to impose VAT on electricity usage.

"Today, we hear they have imposed VAT on books, and soon it will be water and then it will be on how many children we can have,” Dr Baah said.


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