Parliament to address Tax Exemption Bill when sitting resumes
Parliament is expected to address the Tax Exemptions Bill, 2021 when sitting resumes next year.
The bill which was laid by Finance Minister Ken Ofori-Atta on November 16, 2021, is currently before the Finance Committee.
The aim of the Bill is to streamline and rationalize the current exemptions regime on taxes, levies, fees and charges to improve domestic revenue mobilization by consolidating the already existing statutory provisions on tax and other exemptions and to provide for the administration of exemptions.
The bill has been in and out of Parliament for a while now, it expired with the 7th Parliament after it was laid and referred to the Finance Committee. There are however moves to ensure the current bill is passed by the 8th Parliament this time around.
According to the Institute of Economic Affairs, Ghana loses over GH¢5 billion every year through tax exemptions, which the Ghana Revenue Authority has had a cause to complain about revenues lost to the granting of indiscriminate exemptions.
Speaking at a stakeholder’s round-table discussion on the 2021 tax exemptions bill, head of exemptions for GRA, Mrs. Adelaide Botchway, declared steps must be taken to check the abuse of the exemptions regime
“Past beneficiaries are enormous and when you look at the percentage critically, it appears the exemptions are even outweighing the revenues we are collecting.”
“And then the abuses are also on a higher side. But GRA is trying as much as possible to monitor the exemptions and curb the abuses.” She said.
Finance Minister Ken Ofori-Atta has assured the bill will be passed in the next meeting of Parliament which starts in January 2022.
Some civil society including the Tax Justice Coalition, Ghana (TJC); the Ghana Anti-Corruption Coalition (GACC); and the Parliamentary Network Africa (PNAfrica) with support from OXFAM are on a crusade to get the bill passed. The group has also tabled amendments to the bill in order to curb abuses.
Parliament is currently on a break but Chairman for the Finance Committee, Kwaku Kwarteng, tells Starr News in an interview the Exemptions Bill will be one of the key pieces of legislation his committee will devote time to when the house resumes.
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Ken Ofori-Atta assures passage of Bill in 2022
Minister for Finance, Ken Ofori-Atta, has said government will ensure the passage and implementation of The Tax Exemptions Bill tthis year.
“Mr. Speaker, after undergoing several reviews the Exemptions Bill has been completed and laid before Parliament. We hope to work with this House for final passage and implementation in 2022,” stated Mr Ofori-Atta.
The Minister for Finance made the above assertion during his presentation of the 2022 budget on the floor of Parliament on Wednesday, November 17.
The assurance of the passage of the Tax Exemptions Bill follows several calls by economic analysts and tax experts for its passage to curb the abuse of the country’s current tax exemption regime and end the loss of billions of cedis by the state due to tax waivers granted local and particularly foreign companies.
It is estimated that Ghana lost $2.4 billion in 2011 alone as a result of tax exemptions. The figure grew to $2.5 billion in 2013 representing 5.2% of gross domestic product (GDP).
The new Tax Exemptions Bill when passed is expected to support sectors such as the pharmaceutical, automobile, housing and construction sectors.
