"Parliament to pass Tax Exemption Bill in July"

" \n Parliament to pass Tax Exemption Bill in July \n \n\n \n The much-awaited Tax Exemption Bill is expected to be passed into law by Parliament in July this year. \n \n\n \n The bill which was withdrawn from Parliament last week is expected to make its way back to the House this week after some revisions. \n \n\n \n Speaking to the media on the passage of the Bill, Chairman of the Finance Committee in Parliament and MP for Obuasi West, Kwaku Kwarteng, refuted claims suggesting that the passage of the bill will hurt investor confidence. \n \n\n \n \u201cInvestors just want stability in our tax regime. I don\u2019t think lack of exemptions will hurt investor confidence in our economy.\" \n \n\n \n \u201cThe tax exemptions bill is not really too keen to grant exemptions as a way of promoting local content. We can use other instruments to do that if we want to, generally, the principle is that whenever we can stop the exemptions, we do. I\u2019m just waiting for it to be passed into law then the proper education will start,\" he stated. \n \n\n \n Adding that, government will roll out a series of education after the passage of the bill into law. \n \n\n \n \u201cWhat we have tried to discourage is use tax exemptions to promote local content, once the tax exemptions bill is passed, there\u2019ll be a lot of education ,\u201d he said. \n \n\n \n High tax exemptions hurting Ghana\u2019s economy \n \n\n \n Prof Godfred Bokpin, an economist with the\u00a0University of Ghana Business School\u00a0has said delays on the part of the government in passing the tax exemption bill into law is creating a major leak in the country\u2019s revenue generation. \n \n\n \n \u201cThe biggest threat to our revenue mobilisation is tax exemption. In less than 15 years \u2026 Ghana has given away about half of its revenue base through exemptions, for me it is the biggest leak in our economic structures,\u201d he pointed out. \n \n\n \n According to the\u00a0Institute of Economic Affairs\u00a0(IEA), Ghana loses over GHC 5 billion every year through tax exemptions alone. \n \n\n \n Pierre Frank Laporte, the\u00a0World Bank\u00a0country director, has said one of Ghana\u2019s biggest problems is offering too many tax exemptions. \n \n\n \n According to him, the only way the\u00a0country\u00a0can fix its debt to\u00a0GDP ratio\u00a0is not just by cutting expenditure, but by increasing revenue. \n \n\n \n In an earlier interview, Mr Laporte said Ghana would first have to shirk some of its tax practices, particularly tax exemptions while increasing efficiency in tax collection. \n \n\n \n He explained that the tax exemptions are for instance to attract more foreign investors into the country, but the empirical evidence has proven that too many tax exemptions have failed to provide the desired results. \n \n\n \n \u201cSo, you talked about efficiency, that\u2019s one thing, to make sure that everybody pays what they should be paying. That for instance if you look at exemptions in Ghana it\u2019s a big problem. There are too many exemptions. \n \n\n \n \u201cAnd this is a conversation we\u2019re having with the Ministry of Finance. Very often countries think you can give so much incentives, so much concessions, and exemptions to attract investors. But there are other ways that this can be done,\u201d Laporte said. \n \n\n \n He added, \u201cEmpirical evidence has shown that these incentives excessively, in the long run, don\u2019t work. \n \n\n \n \u201cVAT exemptions are given to many big investors to facilitate their entry and to launch their activities. But in many countries, either you have a quick VAT refund, it\u2019s like the investor pays his VAT and you process his refund in one month or two.\" \n "

"Parliament to pass Tax Exemption Bill in July"

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