Last week, the Ministry of Finance and International Finance Corporation (IFC) convened business leaders in the country to share ideas for ramping up investment toward sustainable growth and job creation, dubbed the Mutual Prosperity Dialogues.
An issue foremost in the minds of businesses, as gleaned from the interaction, was that of multiple taxes; which they say is hampering their performance. Chief Executive Officer-Association of Ghana Industries (AGI), Seth Twum-Akwaboah expressed concern about the numerous taxes affecting businesses.
Indeed, the dialogue’s overarching concern was an urgent need to tackle the complex tax landscape impacting negatively on businesses – particularly producers.
Mr. Twum-Akwaboah suggested that a tax review to address the issue of businesses having to pay multiple taxes, like VAT, which comprise the National Health Insurance Levy (NHIL), Ghana Education Trust Fund Levy (GETFund Levy) and the COVID -19 Health Recovery Levy (COVID-19 HRL), as they are weighing heavily on domestic manufacturers and their ability to compete with peers from other parts of the world.
Equally important, he said, enforcing compliance with existing tax policies and reducing revenue leakages might be the solution instead of introducing new taxes – a sentiment echoed throughout the event.
Stakeholders from both the public and private sectors called for a focus on enforcing existing tax policies and removing obstacles to fair trade practices. Creating a business-friendly environment, prioritising investment in local production capacity and implementing strategies for sustainable economic growth were key points discussed during the event.
Sentiments shared by stakeholders at the event are similar to findings of KPMG’s 2024 Pre-Budget Survey Report, which revealed that businesses in the country are urgently calling for a comprehensive review of tax policies among others.
Mr. Twum-Akwaboah also raised concerns about sub-standard products entering the market and competing unfairly with locally produced goods.
The dialogue also highlighted a need to attract investments to boost local production capacity, with a focus on essential goods. Industrialisation, especially in conjunction with agriculture, was highlighted as crucial for the country’s long-term prosperity.
Businesses collectively believe government should prioritise three essential Sustainable Development Goals (SDGs) in the upcoming 2024 budget.
According to a pre-2024 Budget survey by KPMG that interviewed 133 businesses across various industries, the top-three SDGs businesses believe the 2024 budget should focus on are: Goal 1, No Poverty; Goal 3, Good Health and Well-Being; and Goal 4, Quality Education.
These SDGs have been identified by businesses as crucial for the nation’s progress, and they believe government must allocate adequate resources to address them effectively.
Evans Asare, Partner of Deal Advisory at KPMG, emphasised the importance of prioritising these SDGs, stating: “Businesses feel that the 2024 budget must address these three most important goals in the SDGs”.
Mr. Evans Asare however commended government’s efforts to integrate ESG (environmental, social and governance) principles into budget allocation and processes. In the same vein, he highlighted the need for businesses to actively incorporate ESG into their operations.
The survey also highlighted the degree of alignment between businesses and the SDGs. While 85 percent of respondents indicated that their businesses are aligned with the SDGs, 15 percent expressed a desire to align their operations with these global objectives.
This shows a widespread consciousness among businesses about the SDGs’ significance for national development.
Respondents proposed that government should use SDGs as the basis for resource allocation, and prepare a qualitative report on how the budget contributes to achieving these global goals.
Respondents provided reasons for their desire to see the 2024 budget prioritise the three selected SDGs. In light of the ongoing challenges posed by the COVID-19 pandemic, businesses are acutely aware of the significance of ensuring good health and well-being for all.
Businesses recognise that poverty eradication should be a top priority for government, as a hungry population cannot actively participate in economic activities and innovation.
Given that quality education is seen as a catalyst for societal advancement, businesses stressed the importance of accessible and high-quality education in fostering job creation and empowering the workforce.
Key areas of importance for businesses in aligning with the SDGs include human resource development, affordable energy and responsible use of raw materials. These factors were identified as having a substantial impact on economic development, citizens’ well-being, social transformation and job creation.
