President of the Ghana Union of Traders (GUTA), Dr Joseph Obeng, has disclosed that the union was not engaged on the recently passed tax bills.
According to him, the Finance Ministry did not engage them for their input even despite their resistance concerning the adverse impact of the tax bills. He emphasized that there had not been any stakeholder engagement and that GUTA had not been given the privilege to offer submissions towards the tax bills.
“We were never engaged. Maybe AGI would have been privileged but we were never engaged, and so I cannot say the same things that they’re saying. But it’s very unfortunate because it has always been the norm that whenever there is a new tax, they consult us and then we build consensus. That’s how government and businesses have been doing. Even when it bypasses us and goes to parliament, and we raise concerns, they hold on to it and then come and engage us again.”
Dr Joseph Obeng
Dr Obeng explained that the government going ahead to present and pass the tax bills without engagement is testament to their resolve to “bring it regardless of the pleas from the business community”. He noted that GUTA tried several avenues to get the government to at least engage them on the bill, but none came to fruition.
“So many petitions have been sent to parliament itself; to the Speaker and then press releases have been issued… So, this, almost all the business unions and organization have protested to this very bill because we are overburdened with tax payments, seriously and it is true, to the extent that any layer of course of doing business would have succeeded in breaking the backs of businesses and that’s our fears and that’s why we disapprove this bill.”
Dr Joseph Obeng
On his part, Chief Executive officer of the Ghana National Chamber of Commerce and Industry, Mark Badu-Aboagye, disclosed that the government’s explanation that the tax bills are needed to help the government, among other things, improve the revenue situation of the country is not sufficient.
Mr Badu-Aboagye highlighted that the only reason the country is in this predicament is as a result of the government’s failure to appropriately control its expenditure and borrowing.
“I think we have talked about government expenditure and the extent of borrowing. And we’ve made it clear to government that these things this is how it’s going to end us. It will get to a point where we cannot sustain our borrowing and our ability to pay these loans will not be there. So, put a halt to it, also check your expenditure…”
Mark Badu-Aboagye
AGI disappointed over passage of tax bills
Meanwhile, the Association of Ghana Industries (AGI) has expressed disappointment at the passage of the three revenue bills: Excise Duty, Growth and Sustainability Levy and Income Amendment Bills by Parliament.
Contained in a statement, the AGI stated that the passage of these bills, especially considering the already unfriendly business climate, poses very dire consequences for industry.
“We continue to experience a tax regime that does not motivate local production and formal business operations. We denounce the lack of stakeholder consultation on such fiscal policies, which have negative impact on businesses. AGI took steps to make input to the bills and it’s obvious that our submissions did not receive the consideration we expected.”
Association of Ghana Industries
Furthermore, the AGI noted that local industries are already under severe pressure from several challenges. It indicated that electricity tariffs shot up significantly on two occasions totaling a whopping 56.5%, within a period of less than six months.
To this end, it highlighted that the beverage sector absorbed water tariff increment of over 300% in a single tariff review and now excise duties has been slapped on locally produced beverages.
“Contrary to Government’s ambitious revenue projection which largely hinges on the performance of Industry, we foresee a contraction in manufacturing and other related business activities.”
Association of Ghana Industries
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