On point - July 2013

The Communication Service Tax ("CST") was introduced in 2008 as a tax to raise additional revenue from communications services rendered by mobile operators to their customers In the process of implementing the CST Act, the telecommunications companies ("Telcos") raised administrative and legal objections on the Ghana Revenue Authority's ("GRA") resolve to collect CST from the Telcos on local interconnection services culminating in the landmark judgment handed down by the Commercial Division of the Accra Fast Track High Court in favour of the Telcos (i.e Scancom Limited, now MTN, Ghana Telecom Co Ltd, now Vodafone, and Milicom Ghana Limited, also known as TiGo. The judgement effectively barred GRA and Government from collecting CST on interconnect services. It is our considered view that the CST Bill ("CSTB") is a direct response of Government and the GRA in terms of their inability to collect CST on interconnect services.