Friday, 24 May

I will abolish unnecessary taxes - Kyerematen to GUTA

Business
Alan Kyerematen and GUTA President

In an engagement with the Ghana Union of Traders Associations (GUTA) on Wednesday 10th April 2024, Mr Alan Kyerematen, Founder and Leader of the Movement for Change and independent presidential candidate, has stated emphatically he would abolish a number of taxes imposed on imports that are unnecessary and a huge burden on the trading community. 

“Under my presidency, Ghana will have the lowest tax rate regime in ECOWAS,” he said. 

Outlining a raft of radical tax measures to realign and reduce the burden of taxes on Ghanaians, especially on imports, he said immediate measures will include consolidating the existing NHIL & GETFund levies at the ports into the calculation of a new VAT rate, and the abolition of the Special Import Levy of 2%, COVID-19 Health Recovery Levy and the Ghana Health Service Disinfection Fee. 

Within two years of the establishment of his government of national unity, any taxes and other charges on the importation of spare parts would also be abolished, he said. 

Again, a comprehensive review of all statutory fees and charges on imports imposed by regulatory agencies would be undertaken, with a view to consolidating all such charges and fees into a convenient payment system which would incorporate a new Cash Waterfall mechanism, designed to meet statutory agency requirements and reduce the burden on importers, Mr Kyerematen assured.

Furthermore, a comprehensive assessment of the relevance of all other administrative fees, service charges, and levies imposed at the ports will be undertaken, he added.

Additionally, he said he would establish a fixed exchange rate for the calculation of import duties over a specified period, and fix the exchange rate for specified strategic and essential commodities below the prevailing rate in a ‘second window ’ to reduce the high level of imported inflation in the economy. 

All these tax review measures add up to the most radical and comprehensive review of the import tax regime to date.

When implemented, the environment for doing business in Ghana would be positively transformed, he asserted. 

Bemoaning the plethora of taxes that make business difficult in Ghana, the President of GUTA, Dr Obeng, mentioned twenty-two (22) different taxes apart from VAT, adding up to nearly sixty-five (65) percent of the value of imports. Moreover, over fourteen (14) state agencies operate in the port, as well as various security agencies, he outlined. 

This state of affairs drives up the cost of doing business, making businesses move to other ports, and encouraging unethical practices, Dr Obeng bemoaned. 

Recognising the level of stress and difficulties faced by the Ghanaian business owner, which is ultimately transferred to the customer, Mr Kyerematen stressed the importance of easing the business environment for traders as a means of improving the livelihoods of ordinary Ghanaians. 

Until the government creates an enabling environment for private sector-led growth, the transformation that we so desire will continue to elude us, he said.  

In another groundbreaking and innovative approach, Alan Kyerematen intimated that a government under his leadership will shift from the current heavy reliance on indirect taxes to direct taxes. 

“I will ensure a recalibration of the existing tax regime structure to optimize revenue mobilization from direct taxes (personal and corporate), and reduce over-reliance on indirect taxes (import duties, levies, and charges) to make the corporate sector more competitive and profitable,” he said. 

Mr Kyerematen based his remarks on the plans set out in his Great Transformational Plan (GTP), which seeks to move beyond the mere promises of political party manifestoes to actual plans that can deliver the vision of Ghanaians for a prosperous, united, and peaceful Ghana that provides equal opportunities for all, especially young people, women, and other vulnerable groups.

Source: Classfmonline.com/Cecil Mensah