The five new tax measures approved by Parliament will further inflict economic pains on Ghana’s Founding President of Imani Africa, Franklin Cudjoe, has said.
In a statement, Mr Cudjoe also said a ‘raft’ of unclear tax exemptions also were approved.
“Parliament on Friday night approved 5 more taxes to help Nana Addo’s Big Daddy state splash out big time in 2024-an election year- inflicting more economic pain. A raft of unclear tax exemptions too were approved with the exception of exemption on agricultural inputs, which makes sense seeing as food inflation is still high. A reduction in food inflation will see overall inflation reduced to manageable limits by mid-2024.
“I am hopeful the current Agric Minister will rely on his precocious security background to ensure fertilizers do not end up on donkeys carted away to Togo and Burkina as happened under his predecessor. So, yes, 5 more taxes to note coming into force on January 1, 2024. You see as the famous American Lawyer, Politician and Newspaper editor Gideon Tucker once said, “No man’s life, liberty or property are safe while the Legislature is in session.” And Ghana’s Parliament decided to impose these taxes at night, so spend wisely this Christmas,” his statement said.
Parliament on Friday, December 22 approved five tax bills aimed at helping the government to rake in additional revenue to the state as well as the Appropriation Bill, 2023.
They are the Value Added Tax (Amendment) Bill, 2023, Excise Duty (Amendment) (No. 2) Bill, 2023, Stamp Duty (Amendment) Bill, 2023 Emissions Levy Bill, 2023 and Exemptions (Amendment) Bill, 2023.
The VAT Bill seeks to expand the tax net and extend the zero rate on locally manufactured products, introduce a zero rate on locally-produced sanitary towels and waive the VAT on the import of electric vehicles for public transportation.
It will also introduce a flat rate of five per cent for the rental of commercial premises and the sale of immovable property by an estate developer.
Set to amend the existing VAT regime, the bill is estimated to yield GH¢3.725 billion for the 2024 financial year, reports Graphic Online’s Nana Konadu Agyeman from Parliament House.
The Excise Duty Bill is to amend the Excite Duty Act, 2015 (Act 878) to increase the excise duty rate on cider bear to align with the excise duty rate on beer, reduce excise duty on plastics and expand the coverage of the excise duty on plastics to cover imported plastic packaging.
It will also introduce an emission tax on carbon dioxide emissions by companies and from vehicles.It is expecyed to yield approximately GH¢540 million in additional revenue to the state.
Third, the Stamp Duty (Amendment) Bill is to amend the Stamp Duty Act, 2005 (Act 689) to review the rates of stamp duty on specified instruments that have legal effect in line with current economic realities.
It is not a tax on transactions but on documents brought into being for the purpose of recording transactions.
The revision of the rates of stamp duty is expected to yield an amount of GH¢653 million in revenue for the 2024 financial year.
The purpose of the Emissions Levy Bill is to promote the use of eco-friendly technologies and green energy.
Seeking to control the level of carbon dioxide emissions from internal combustion engine vehicles in Ghana, the bill will generate an amount of GH¢541 million for the 2024 fiscal year.
Fifth, the Exemptions (Amendment) Bill, 2023 is to provide a waiver of customs duties and customs taxes in respect of the importation of fishing gear and agricultural inputs.
The bill, waiver will result in estimated exemptions to the tune of GH¢442.65 million next year.
It will provide for the exemption from customs duties and customs taxes, seeds and fertilisers imported for agricultural purposes in relation to the phase two of the Planting for Food and Jobs Programme.