Dr. John Kwakye, the Director of Research at the Institute of Economic Affairs has called on the government to tax extractive companies and take super profit tax from companies like Telecom and Banks in the wake of the DDEP.
According to the Director of Research, government is burdening individuals with taxes, hence, the need to look at other alternatives.
“We don’t tax companies enough, that, you know, they work in areas where the economy is booming; the extractives, telecos, banks. And as a developing country, that’s where you need to go. You don’t tax poor people whose incomes are so tiny. You know, but for some reason, we try to avoid that.
Dr. Kwakye
Speaking at a press conference organized by his outfit, Dr. Kwakye urged the government to explore various ways of raking in more revenues domestically to support the government in its restructure of the country’s debt.
The Director of Research suggested that the government should close tax loopholes, particularly those related to import and property taxes, by implementing laws and regulations.
Additionally, he urged the government to renegotiate and adjust the payments to Independent Power Producers as part of the Domestic Debt Exchange Program.
“We need to make sure we close various loopholes in relation to taxes. Government should renegotiate and scale back payment to independent power producers in the spirit of burden sharing.”
Dr. Kwakye
Meanwhile, Dr. John Kwakye has requested that the government lifts the 3-year freeze on repaying the principal for the Domestic Debt Exchange Programme (DDEP).
“We are also saying that the 3-year moratorium on the repayment of the principal, the fact that government says for the first 3 years, I am not going to pay you anything on your principal, we are saying it should be abolished.”
Dr. Kwakye
Still on the issue of taxes, Civil Society Organizations (CSOs) – Peasant Farmers Association of Ghana (PFAG), Chamber of Agribusiness Ghana (CAG), CropLife Ghana and the National Seed Trade Association of Ghana(NASTAG) are demanding from government tax exemptions on imported inputs.
Delay of Tax Exemptions To Adversely Affect The Agricultural Sector
According to the CSOs, the granting of these tax exemptions, which has delayed could deny millions of Ghanaians access to cheaper food.
The agricultural sector is also likely to be faced with dire consequences following its fragile nature – which is attributable to global price hikes in agricultural machinery and inputs.
The CSOs have reported that the delay, which has been two weeks since the time of the application for the grant is already costing them as a sector and also affecting imports.
The organization therefore sends out a forewarning to the government against further worsening of the situation in the sector, stating that it could further worsen the food security situation in the country should nothing be done about the taxes.
“While we still await a decision from the Finance Ministry to grant the request, our clients and service providers have their goods currently locked up at the ports due to exorbitant import taxes.”
CSOs
The CSOs cited an example of one service provider who has livestock vaccines valued at GH¢420,000 in import fees being asked to pay GH¢330,000 as taxes since the products were no longer exempted.
The company, as a result, had to cease the clearing process and ask for an extension, hoping that the Finance Minister will soon grant the exemption yet the delay.
Importers of agrochemicals and inputs said with respect to the prevalent situation that they will have no other option than to ‘slap’ the tax margins on cost of agrochemicals and inputs should the government refuse to hearken to their concerns and grant them request of an exemption.
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