The delay in approving tax waivers to companies under the One District-One Factory (1D1F) initiative by parliament has been described as ‘worrying and killing industry’ by the Chairperson of the Trade Committee in Parliament, Carlos Kingsley Ahenkorah.
Mr. Ahenkorah made these remarks on the floor of parliament following presentation of the business statement for this week.
There are currently some 150 tax exemptions of companies outstanding that were brought before the House and later referred to the committee for consideration to ensure that exemptions are awarded on merit.
Mr. Ahenkorah’s outburst stemmed from the fact that parliament failed to consider the waivers before recess, which is scheduled for this week. The cost that these companies will incur on demurrage and freights at the ports is what is of concern to the trade committee.
For his part, the Minority leader Cassiel Ato Forson however disagreed with the Chairperson of the Trade Committee position, adding, that it is not true that the committee deliberately declined to consider the matter since we are talking about 150 tax exemptions for companies amounting to billions of cedis.
Meanwhile, the economy lost GH¢27billion to tax exemptions between 2008 and 2020, leading to passage of the Tax Exemptions bill last July. It provides for a tax exemption regime in the country with defined criteria for exemptions, and was expected to save the economy GH¢460million in 2022 according to Minister of Finance.
Thus, it is quite clear to understand the intense scrutiny that has to be done in granting tax exemptions but at the same time, we understand the frustration of the Mr. Ahenkorah because it is something that was expected by those embarking the 1D1F industrialization policy.
It is prudent for Parliament to scrutinise the request and determine which companies under the 1D1F qualify for tax waivers or exemptions since the economy as a whole is suffering badly from the indiscriminate awards of tax waivers to companies.
Like Kwame Governs Agbodza, Member of Parliament explained, tax waivers are not to be given just because people are demanding them, but must be granted based on merit.
