The solution to the challenges facing the Ghanaian economy is local production, Chairman of the Greater Accra Regional branch of the Association of Ghana Industries (AGI), Mr. Tsonam Akpeloo, has said.
In Ghana, he stated, the environment does not make it easier for local production as a result of a lack of clear policies to protect indigenous producers and also high taxes.
Speaking at the 3businesscolloquium organized by Media General on Wednesday, July 6, Mr. Tsonam said “If you are an investor in New York and you want to invest in rice farming, you go to Nigeria, you don’t come to Ghana. Because Nigeria has a clear policy protecting the rice farmer in Nigeria. In fact, they have actually banned the importation of rice so, if you have money and you want to invest in rice production you don’t come to Ghana you go to Nigeria.”
He added “So, how are you going to attract a rice investor to come to Ghana? That is the situation. The situation is that over time there is no longer incentive for people to want to really produce locally but everybody agrees that the solution to the problem facing us is local production. We need to boost local industry.”
“How are we going to do that if we don’t have the right policy and the right environment. Look at the taxes, we have got Sanitation Tax and at the same time we have Environmental Levy, the same thing you are taxing us many, look at the street light tax. All of these taxes are just making the cost go up and as a result, it is really difficult to sustain proper production in our environment.”
For his part, Information Minister Kojo Oppong Nkrumah said that a number of the government’s revenue sources such as the Value Added Tax (VAT) are not performing well.
This, he said, is a situation that must be confronted in order to rely less on financing and also reduce the debt burden.
The Ofoase Ayirebi lawmaker said “A number of our revenue handles in this country are not performing optimally. Take VAT. VAT compliance, the data has gone down. Those who manage fiscal policy will tell you that sometimes, they have to compensate for the nonperformance by hiking up the rate.”
“I agree that you have to ensure that the rates are down, like we always say, broaden the base. But we have to come to a certain point where we push more to get those VAT numbers where they ought to be so that we can get funding for the Ghana we want.”
“Take property rates. If you were to send the piece of paper around this auditorium to ask everybody how much property rate did you pay in the year 2020, we may be amazed at the data we are getting.”
“These are the realities, in all humility, that we have to confront to move tax to GDP rate from this 12 per cent to about 25 percent so that you rely less on financing and reduce your debt burden but that will deal with only one side of the challenge.”