State loses huge revenue from quarry due to underreporting – ACEP study
The state loses huge revenue from quarry mining due to underreporting and excessive focus on gold, says a study by Africa Centre for Energy Policy (ACEP). The study, Estimating the revenue potential of the quarry subsector in Ghana, surveyed 15 firms and found out that revenue from royalties and corporate income from the sampled size was 12 times more the total industry revenue in 2020.
It established that underreporting of production volumes and revenues continues to deny the state much-needed revenue – a situation in which it said the Ghana Revenue Authority and Minerals Commission must do more to harness the industry’s full revenue potential.
“The assessment we did is very conservative, taking in just 15 mine sites. The assessment of 15 quarry sites was 12 times more than what is reported as revenue nationwide. It tells you that the potential is huge if government pays attention and monitors that space,” ACEP’s Executive Director, Benjamin Boakye, told the B&FT in Accra.
He spoke on the sidelines of a sub-regional forum and stakeholders’ engagement on revenue mobilisation in the extractive the sector, and added that ACEP’s preliminary interrogation of government data on monitoring by agencies of state points to potential underreporting of production and revenues by companies to the state.
The industry, the report noted, is essential for the provision of raw materials for infrastructural development, employment, livelihood sustainment and government revenues. Its contribution to revenue generation of the mining and quarry sector, however, is insignificant.
Unlike gold and other mined assets, the report said, the industry is insulated from the persistent risk of commodity price shocks on the global market; and therefore should be able to generate more stable revenue to support government budget implementation.
“We have to improve monitoring by developing tools that allow us to do remote monitoring. Tracking trucks and vehicles moving with truck-loads of quarry is even easier than monitoring gold. There are a lot of illegalities happening, and they [GRA] just wait for self-reporting from the companies; but the companies don’t report the accurate data,” Mr. Boakye added.
Quarrying operations in Ghana include the production of granite, limestone and sandstone for use mainly in building and road construction. Four countries – Ghana, Liberia, Nigeria and Sierra Leone – participated in the forum.
