The International Monetary Fund (IMF) has signalled its openness to exploring alternative approaches to address Ghana’s revenue shortfall following the suspension of the Value-Added Tax (VAT) on electricity.

Acknowledging the concerns raised regarding the tax's implementation and its potential impact on households and businesses, the IMF emphasised its sensitivity to public sentiment on the matter.

During a meeting with selected journalists, IMF Managing Director Kristalina Georgieva assured of collaborative efforts to find a mutually beneficial solution that would narrow the debt gap and solidify economic progress.

Ms Georgieva stressed the IMF's ongoing engagement with Ghanaian authorities to identify favorable policy options aimed at reducing debt levels and reinforcing macroeconomic achievements.

"We recognise the impact on the people of Ghana, particularly low-income households, for whom any additional cost poses significant challenges. We must balance the objective of strengthening the government's fiscal position with the need to alleviate burdens on citizens. There are various measures we can explore to achieve this goal."

The Government of Ghana officially halted the planned 15 per cent Value Added Tax (VAT) on domestic electricity consumption in February, following instructions from the Ministry of Finance. This decision was made to facilitate extensive dialogue with industry stakeholders and labour unions.

The Ministry of Finance noted that the suspension aimed to enable further discussions with the IMF, as the VAT on electricity was a critical component of Ghana's post-COVID-19 Economic Recovery program.

Georgieva emphasized the ongoing discussions, highlighting the government's need to internally explore options to ensure debt and fiscal sustainability. She reiterated the IMF's commitment to assisting in this endeavour.