2024 Budget: Review existing taxes downwards — GNCCI
THE Ghana National Chamber of Commerce and Industry (GNCCI) has called on the government to review downwards the existing taxes to bring some relief to businesses.
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The Chamber maintained that the upward revision of utility tariffs and the implementation of three new tax amendment bills in 2023 in addition to the already excessive direct and indirect taxes and levies have contributed significantly to increased production costs.
These developments, it said, have greatly affected the competitiveness of local businesses in the country, leading to low production and the collapse of many businesses in the country.
The President of GNCCI, Dr Clement Osei-Amoako, made the call last Tuesday at the Chamber’s 47th Annual General Meeting (AGM) in Accra on the theme: “Building Business Confidence in the Midst of Economic Challenges.”
“Given the introduction of new and increased excise duty, growth and sustainability levy, and new income tax rate and income tax bracket under the new tax amendment bills passed this year, the chamber wants the government to review downwards the already existing taxes including reverting the current Value Added Tax (VAT) regime to its original (2016) state and removing the COVID-19 levy which has outlived its relevance to bring some relief to businesses.
The chamber also expects a review of port levies and duties to make the Ghanaian port less expensive for business,” he stressed.
Supporting private sector growth
Dr Osei-Amoako explained that interaction with businesses indicates that the confidence of businesses in the economy has grown cold, therefore, not surprising that the manufacturing sector which has the potential to change the structure of Ghana’s economy has recorded contraction continuously since the beginning of this year.
He said despite achieving some level of stability in the exchange rate following the disbursement of the first tranche of the International Monetary Fund (IMF) and the gradual decline in the inflation rate, there was still much work to be done, particularly in the manufacturing sector.
“The government would have to implement policies that support investment and private sector growth in the areas of manufacturing, agriculture and food production to fuel a structural transformation process for growth.
This would help to also reduce inflation given the contribution of food prices to inflation in the country, without employing further monetary tightening,” the Chamber President said.
Overpricing of goods
The Minister of Trade and Industry, K.T. Hammond, who expressed concern about the excessive profit made by some traders, said the government was not unappreciative of the various cost and input factors of production nor unaware of the effect of dollarisation of the economy.
He said although most of the players in the industry imported either their raw materials or goods from outside the country, such goods purchased in the foreign currencies were at least not so much yet.
“I am acutely aware therefore that any vacillation in that means of purchase has a direct and cascading effect on the prices of your end product.”
I have on many occasions heard your plaintive cries about the taxes and levies you pay to the government, but I am bound to ask the question whether these are all the reasons why the cost of living in Ghana is so unacceptably high,” he quizzed.
The minister explained that businesses operated in a modern, free and liberal economy in which the government has no direct hand in the pricing of goods and services but strain all its efforts and resources to create a conducive atmosphere for businesses to thrive.
“Whatever the direct or indirect causes for the very high cost of your goods and services and your wares in our shops and markets, I implore you, for the sake of your corporate social responsibility to your consumers and the country as a whole, reduce your prices and help make life a little bearable for the consumer, while government reciprocates your gesture by establishing the appropriate economic framework so we collectively thrive as a nation,” he appealed.