President Akufo-Addo
AHEAD OF THE presentation of the budget for 2024 by President Akufo-Addo, the Food and Beverages Association of Ghana (FABAG), has sent a passionate appeal to government to, as a matter of urgency, withdraw what they describe as “harmful taxes” on products.
In a statement co-signed by its Executive Chairman, John Awuni, and General Secretary, Samuel Ato Aggrey, the Association indicated that the business community, especially the food and beverages sector, is experiencing very turbulent and challenging times in the 2023 fiscal year as a result of huge taxes slapped on products, especially the excise tax on sweetened beverages, fruit juices and alcoholic beverages.
According to the Association, a lot of businesses in the food and beverages sector “are reeling under tremendous pressure in terms of their ability to maintain their working capital, and in addition, honouring the inevitable interest and tax payment obligations.
“The Food and Beverages Association of Ghana (FABAG) is appealing to the government ahead of the presentation of the 2024 budget statement to take a critical and concerned look at the tax measures introduced in the year 2023, especially the excise tax on sweetened beverages, fruit juices and alcoholic beverages; as well as the growth and sustainability law, which taxes profit before the mandated corporate tax. We consider this basically as double taxation which erodes our investment capital,” they lamented.
“If possible, they should be withdrawn completely as they appear to be a nuisance on our profitability and performance of players in this sector,” the Association pleaded.
The Association highlighted some taxes and levies which they said made the cost of manufactured and imported goods “very high” to the consumer, including import duty (20%); import VAT (15%); ECOWAS levy (0.50%); network charge (0.40%); network charge VAT (15%); and network charge COVID-19 (1%).
Others are the network charge NHIL (2.5%); special import levy (2%); import NHIL (2.5%); withholding tax on import (1%); Ghana export import bank levy (0.75%); among others.
The Association also indicated that the significant drop in imports as reported by the Bank of Ghana recently supports their concern that, the food and beverages sector has been badly hit.
The decline in imports, it explained, does not point to the fact that local production has increased but rather the food and beverages sector has shrank, giving a great cause of worry to the private sector, thereby inhibiting its ability to perform optimally as the engine of growth of the economy.
BY Nii Adjei Mensahfio