Local banks have sent out messages announcing the discontinuation of VAT on financial services.

READ MORE: GRA warns financial institutions to halt charging VAT on financial services

It follows the passing of the Value Added Tax (Amendment) Act by Parliament in March

Many banks on Friday sent out messages informing their customers of the decision.

Ecobank said: “Dear client, the VAT ACT as amended (Act,948, 2017) abolishes the 17.5% VAT on financial services. Accordingly, Ecobank has stopped charging VAT on transaction.”

UMB said: “Dear Valued Customer, as directed by the government, UMB will no longer charge VAT on financial services. Please call 0302633988 for more info.”

READ MORE: Former deputy finance minister accuses government of “deceit” over VAT

Cal Bank said: "Dear Client, we have stopped charging VAT on transactions. This is because the 17.5% Tax on Financial Services (VAT Act 948, 2017) has been amended. Thank you."

The Mahama administration introduced the VAT on financial services in 2014 in a bid to rake in more revenue after it was struggling to meet revenue targets.

Describing it as nuisance tax, then candidate Nana Akufo-Addo promised to abolish it when voted for in the 2016 elections.