Employers unhappy over KMA’s new charges

Business News of Saturday, 31 January 2015

Source: B&FT

Kojo Bonsu KMA Boss

Members of the Ghana Employers Association (GEA) in the Ashanti Region are angry over the ‘insensitive posture’ taken by the Kumasi Metropolitan Assembly (KMA) regarding calls to review the astronomical rates it set for properties and businesses in the Metropolis last year.

The employers say the huge charges imposed on them by the Assembly are adversely impacting their business operations, and for which reason some have threatened to relocate to other regions should the Assembly continue to remain indifferent to their plight.

At an end-of-year get-together organised by the GEA in Kumasi to discuss the performances and challenges militating against the growth of businesses in the region, it came up strongly that cost of doing business in the Metropolis has reached intolerable heights as employers say they have to endure paying huge levies and taxes imposed on them by KMA.

The employers noted that the cost of production has risen sharply in the wake of these charges, coupled with the growing interest rates and unending energy crisis among other challenges.

They said despite several appeals to the Assembly to review its rates for the business operating permit and building operating licence it introduced in 2014, nothing meaningful has been done.

They feared that if no immediate steps are taken to address the situation, many companies could be forced out of business or be compelled to down-size their workforce considerably to stay in business.

Dr. Philip Yaw Amakye, former chairman GEA advocacy section in Ashanti, told B&FT that there has been some space created for RCB’s with the Assembly to find a way out. He observed that further on, a three-pronged approach should be adopted to decide suitable rates for businesses and their properties.

He said setting taxes and fees to over 100 percent has a huge potential of crippling businesses, and emphasised that it is important to recognise the need for sustainability of businesses beyond looking for them to pay taxes.

He appealed for employers continue to expressing their concerns through the GEA in order for them to work collectively in finding solutions to these problems.

It will be recalled that the Kumasi Metropolitan Assembly — led by the then newly-appointed Mayor Kojo Bonsu, introduced some new rates and fees for businesses and commercial properties in the Metropolis which took effect from January 31, 2014 to December 31, 2014.

As contained in a document detailing the new rates and fees, businesses categorised under different headings are expected to pay some huge fees which many in the business community described outrageous.

For instance, financial institutions classified under separate sections are expected to pay as much GH?10,000 per annum as business operating permit from a previous GH?1,000 for each branch and agency, while the head offices are to pay GH?15,000.

Manufacturing companies, on the other hand, are at the same time expected to pay as much as GH? 91,000 and GH?15,000 as business operating permit and building operating licence from the previous year’s GH?61,000 and GH? 5,000.

The introduction of these ‘killer’ charges generated so much discomfort among the business community in Kumasi, and one year on employers are complaining of the biting effect it is having on their business operations.

However, in a response to these charges the Chief Executive of KMA, Kojo Bonsu, stated that the upward review is in line with economic trends and done in consultation with the relevant stakeholders.

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