This will make them produce more affordable textiles
Textile manufacturers will continue to benefit from VAT relief
This is to cushion them to produce more textiles
Their pricing is expected to be affordable for all to buy
For the next two years, textile manufacturers will enjoy Value Added Tax (VAT) relief, Finance Minister, Ken Ofori-Atta has said.
The textile manufacturers have in the past two years enjoyed VAT relief to enable them produce affordable textiles.
The VAT relief was rolled out to help the textile industry to be stable and ensure that more goods are made available on the market.
“In 2019, VAT relief was provided on African prints for textile manufacturers to enable them resuscitate their operations and provide affordable textiles to the market. This policy has succeeded in stabilising the industry and formed the basis for a modest increase in production. The companies have also maintained their prices over the period making the cost of local prints affordable,” Ken Ofori-Atta said during the 2022 budget presentation in parliament.
He continued that, “Additionally, they have been able to keep their employees and made some investments in the industry as a result of this Policy. To consolidate the gains and expand production in the industry, government has decided to extend the Relief for a further two years.”
But there has been the scrapping of the benchmark value policy on goods at the ports.
According to Ken Ofori-Atta, the move by government made the supply of goods and services and local goods with imported substitutes uncompetitive.
To end this problem, only retailers will benefit from the flat rate and all other supply of goods and services will attract the standard rate, Ken Ofori-Atta explained.