Mr. Asante Asare
The Association of Gold Exporters of Ghana (AGEG), an umbrella body of local small-scale gold exporters, has called on the current New Patriotic Party (NPP) administration to institute a probe into what it termed unfair trade practices and wanton money laundering by Indians, other expatriates and some management staff of the Precious Minerals Marketing Company (PMMC).
AGEG, in an interview with BUSINESS GUIDE, alleged that the Managing Director of PMMC, George Abradu-Otoo, has over the past few years been supervising the exportation of gold for foreigners, particularly Indians through PMMC using surrogate companies owned by some ‘faceless’ Ghanaians, who apparently are members of the opposition National Democratic Congress (NDC) without repatriating the funds to Ghana as required by law.
The Association also alleged that the said surrogate companies have made it impossible for the expatriates on the local market to pay the 0.5 percent tax by Minerals Commission, which is part of the Mineral Sustainability Fund even though members of AGEG and other locals are being made to pay.
AGEG disclosed that foreign exporters in the sector, with the support of PMMC, have been evading the 3 percent Ghana Revenue Authority (GRA) Withholding Tax, even though they (the foreigners) continue to export gold worth billions of dollars annually.
Chairman of AGEG, Kobina Asante Asare, who spoke to BUSINESS GUIDE, said Ghana is losing billions of dollars annually due to the unfair trade practices by Indians and other expatriates.
“PMMC is exporting gold on behalf of third parties and these guys are not bringing the money back and this is creating a huge vacuum within the sector. PMMC, no matter how much they ship they don’t repatriate one percent,” he said.
“PMMC has argued that they are not responsible for repatriating the funds but rather the Ghana Revenue Authority (GRA). The argument is inappropriate because the right information needed from PMMC concerning the ‘true’ identities of those exporting via PMMC is not being given to GRA, according to him.
He also said that local players in the industry were being crowded out of business due to huge tax burdens which foreigners are not paying.
The chairman of AGEG indicated that local exporters were paying 3 percent withholding tax; 0.5 percent Mineral Sustainability Tax, among others, which is adversely affecting their operations.
According to him, foreigners have taken 90 percent of the domestic gold market leaving Ghanaian players within the sector with just 10 percent due to the unfair trade practices that started under the previous NDC administration.
It would be recalled that Bank of Ghana (BoG), under the Mahama administration, in 2016 ordered that all gold exports must be channeled through PMMC which the Association opposed, leading to a legal tussle between them and PMMC.
In some instances, the expatriates in order to avoid the payment of such taxes, smuggle their gold to neighboring Togo where there is only 1 percent withholding tax and Cote d’ Ivoire which charges 2 percent Withholding tax, he added.
He urged the Nana Addo administration to investigate the MD of PMMC, George Abradu-Otoo and the surrogates companies that are exporting gold on behalf of the expatriates.
Mr Asare appealed to government to ensure fair trade practices on the market, repatriation of proceeds from gold being exported by foreigners and payment of taxes by all operators.
By Melvin Tarlue