We’re committed to removing nuisance taxes - Ken Ofori-Atta
Finance Minister Ken Ofori-Atta has hinted that the government will from next month begin the implementation of one of its flagship campaign promises of abolishing some taxes that it says are harmful to the growth of businesses.
Ghana’s private sector is expected to heave a sigh of relief after the Akufo-Addo’s government presents its first budget in the first week next month.
The move, according to Mr. Ofori-Atta, is expected to spur on growth and provide adequate incentives for the private sector which is to be the engine of growth.
“It is almost saying that because you do not have enough income you are not going to have any savings account. So, if we really believe, which we do, that giving tax incentives will see the entrepreneur or the private sector work harder and therefore generate future taxes, then we go for that. I mean first of all, people are even disputing the fact that we said we’ll provide tax reliefs for example, but we are going do that and we are not going to touch the heritage fund to be able to support the free SHS.”
He further stated that, “we need to able to look at huge projects like railways and co and how we initiate the development which will open up the country.”
The package, the Finance Minister also said, is part of the Akufo-Addo’s government move to ensure that local companies build their capacity to compete favorably with international business who have come to the space.
At the Graphic Business/Stanbic Bank breakfast meeting in Accra on Tuesday, on the theme, “A Public-Private Dialogue on Stability, Growth and Jobs,” the Senior Minister, Mr Yaw Osafo-Maafo hinted that, taxes like the Special Import Levy and the 17.5 percent VAT on imported medicines not produced in the country will be abolished.
Mr. Osafo-Maafo said, “the government would announce further tax measures including the scrapping of the 17.5 percent on financial services and five percent on VAT on Real Estate sales in the 2017 budget which will be presented next month.”
Business groups in the country, especially the Ghana Union of Traders Association (GUTA) have pointed out to the new government on the need for them to quickly scrap some taxes in order to safeguard local businesses.
Some of the issues GUTA wants the NPP government to act on include tax stamp, 3 percent flat VAT rate and the ECOWAS Common External Tariff as well as the influx of foreigners on the country’s retail market.
Some analysts believe that tax cuts and lower taxes help entrepreneurs to save and to invest as it will help boost economic growth.