The President of the Association of Ghana Industries (AGI) has appealed to government to reconsider the three new taxes before passing them through with implementation.
Dr Humphrey Ayim Darke said the new taxes could stifle the growth of industry thereby leading to a further economic crisis.
“Thus shall not sacrifice industry at the expense of IMF agenda which is clearly an objective of government and considering the state of affairs it is the priority of the government.
“But beyond securing this, if thou secures it through sacrificing the Growth, there are consequences so in our conversation and our prayer to government we sought to demonstrate the consequences of this and that leads to the subject matter of the taxes collected over the period,” he said on JoyNews’ Newsfile.
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On April 1, parliament passed the three tax bills which were tabled before it as part of the government’s measures to generate more revenue.
The bills namely the Income Tax Amendment Bill, The Excise Duty Amendment Bill, and the Growth and Sustainability Amendment Bill were passed on Friday evening.
Earlier, the government had stated that the revenue bills are needed to help the government complete processes for the about $3 billion IMF deal as well as improve the revenue situation of the country.
But the AGI President thinks otherwise.
Dr Ayim Darke explained that the economic hardship was not incurred by the lack of revenue generation but by excessive expenditure.
He added that government budget had all revenue generation ideas but there always seemed to be a deficit when it comes to expenditure.
“It isn’t a matter of the revenue but the budget demonstrates that there is always a deficit position of government irrespective of the revenue. Getting revenue is one arm of it, the second is the expenditure.
“So where the expenditure and the revenue has a gap …even though the government will have a target the question is it sufficient to meet its expenditure target once that’s not the case government needs more revenue,” he told host, Samson Lardy Anyenini on Saturday.
Dr Darke stressed that if government continues on its tangent, the business industry will be affected which will exacerbate the current economic hardship.
“AGI concern is that if you seek to sacrifice growth using the Excise duties, it makes industry uncompetitive, it leads to low growth, it leads to unemployment, it leads to the informality of the economy, it leads to low taxation, it opened the door for more importation it puts more pressure on the cedi it distorts the economic formula that you seek to do, what we call the structural transformation,” he added.
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