Industry demands review of tax regime

The Association of Ghana Industries (AGI) has prevailed on the government to amend the present tax regimes in the country in order to reduce the cost of doing business.

“Industries are reeling under the heavy stress of high taxes and utility hikes, forcing some of them to think of downsizing, relocating or shutting down completely,” it said.

The Chief Executive Officer (CEO) of the AGI, Mr Seth Twum-Akwaboah, in an interaction with the management of the Graphic Communications Group Limited (GCGL) last Wednesday, said businesses and domestic consumers were paying more for water and electricity, contrary to the tariffs announced by the Public Utilities Regulatory Commission (PURC).

He stated that although the PURC announced a 59.2 per cent hike in power tariff that was reduced by the government, industry players were paying more, sometimes over 100 per cent, depending on where the businesses were located.

“For instance, in the Tema Free Zones enclave, apart from the general increment, businesses are paying an additional 16 per cent for a power plant that supplies power to that enclave,” he said.

Mr Twum-Akwaboah also spoke about water tariffs and noted that what was being paid by industrial consumers was higher than what was announced.

The concerns of AGI over the increase in tariffis corroborate what the general public has been complaining about with regard to the percentage increase in tarrifs.

To make matters worse, even after the government announced its decision to absorb part of the bill, the utility companies have rather doubled what they charge and the PURC which is mandated, among other things, to protect consumers, is unfortunately silent over the agitations of the public and industry.

He said steel companies were considering other options as a result of the high taxes, saying that if nothing was done, the companies would also shut down because of the non-competitiveness of their products.

Mr Twum-Akwaboah said due to the high cost of doing business in the country, the government’s agenda to promote made-in-Ghana goods was being defeated because local products were more expensive than cheap imports.

He indicated that unbridled liberalisation was rather supporting the job creation efforts of countries from where Ghana imported all kinds of goods.
He warned that if the brakes were not applied, very soon there would be no jobs for the people.

He explained that the visit was part of an outreach programme of the AGI to reach out to its members so that with one voice they could cry out loud to the government to find better ways to protect local industries.

According to him, the AGI was not against competition but rather industry players looked forward to a level playing field for imported and local products.
“The situation is very dire. The government should, therefore, look into the concerns of industries because they hold the key to the success of the country’s economic programmes,” he said.

For his part, the Director of Finance of the GCGL, Mr Kwabena Baah-Adade, who received the delegation on behalf of the managing director, said there was the need for the PURC to address anomalies in electricity bills in order for industries to be competitive.

The Director of G-PAK, a subsidiary of the GCGL, Mr James Dadzie, called on all stakeholders to protect and promote made-in-Ghana goods and services, stating: “if we continue to provide jobs for the people of other countries by always importing goods, our future generation will eventually suffer.”

By: Graphic Online/Ghana