Tax Exemptions Bill to be passed in 2022 – Ken Ofori-Atta
Minister for Finance, Ken Ofori-Atta, has said government will ensure the passage and implementation of The Tax Exemptions Bill next 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.
Speaking in an interview prior to the presentation of the 2022 budget, Isaac Appiah Amankwa, a lecturer at the Faculty of Economics and Business Administration at the Catholic University College of Ghana (CUCG), expressed concern about the gross abuse of the tax ‘exemption regime.’
He said the country loses about five per cent of its Gross Domestic Product (GDP) annually due to the tax holidays and incentives given to companies operating in the free zone.
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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 Bill, which is expected to harmonise the tax exemption and incentives regime in the country and help make it more efficient, comprise tax waivers given to foreign and local companies to encourage an increase in investment and attract more foreign direct investment into the economy.
The Tax Exemptions Bill seeks to streamline the many exemption provisions scattered about in various legislations.
It is also to bring the country’s current tax regime in line with the law to ensure that tax exemption abuses are cut out from the current exemption regime.
The new Tax Exemptions Bill when passed is expected to support sectors such as the pharmaceutical, automobile, housing and construction sectors.
