The Chief Executive Officer for Ultimate Fashion Boutique, Mr. William Addo has prompted government to ease up current taxation laws to reverse the continuous evasion of tax payment among a majority of business owners countrywide, Purefmonline.com reports.
The astute business man labelled Ghana’s Value Added Tax (VAT) system as displeasing and suppressive; scaring away traders from wilfully committing to paying tax.
Mr. William Addo, appearing on Kumasi-based Pure FM in an interview with Kwame Adinkrah, elaborated on the predicaments facing Ghanaian businesses in the current economic discomforts.
“In the tax laws of Ghana, government does expect a fixed VAT of 18.5% from manufacturers to distributors down to retailers, while they have added no value to the goods.”
“If government will deduct income tax from our distributor’s commission, it would surely make sense, meanwhile VAT is demanded not only from the manufacturer but the distributor and retailer as well, which is untenable.”
Mr. William Addo emphasized that a newly introduced 6% levy of the VAT on their meager margins is ridiculously unbearable as their profits are far below that target.
He charged that the VAT structure imposes an inconducive system on traders, compelling many to rebel in opposition by creating a loophole, so adverse to the tax revenue of government.
“It is not the case that we are running away from paying taxes but we want government to initiate processes which wouldn’t cause us looking like criminals to the tax laws.”
“The current one tempts one to forfeit it willingly or not, as it is demanding of me to pay for what is not charged. What happens then is a negotiation with the tax officer to under declare the actual sum while he is paid out.”
“So government is losing revenue. I am telling you. Kwame, we on the grounds are so aware of it and we were very open to them”, He disclosed.
He indicated that they raised these concerns at a meeting with the Finance Ministry, following their recent protests in Kumasi where business owners closed their shops for some days, just to alert government on how beneficial it will be if some changes are effected to the present tax regime.
In addend, he expanded that, some freight and shipping agencies are able to develop fraudulent means to underpay invoices for imported goods in their dealings with port officials all to escape exorbitant duties and taxes they are burdened with.
Mr. Addo narrated that the current cedi depreciation has taken a toll on many businesses depleting their capital.
“Not too long ago, in January, I needed GHC600,000 to change $100,000, but presently, I will need GHC1,300,000 for the same value. Look at the deficit, where do you get it?” He lamented.
Mr. William Addo encouraged government to slowly move the country from being an importing nation to become a self-reliant exporting economy where we we will gradually land at banning the many imported commodities.
He emphasized that it is about time government starts learning from the study case of Nigeria which at a point in time, closed its borders in an attempt to ban rice importation and instead sponsor a home grown policy which is now successful.
“This situation we find ourselves in, though not palatable, has exposed us big time to know we have a hollow governance. It is about practicality. If we will sit down and decide to make things right, we can make things better.”
“If we will take advantage on this situation and sit down to plan well as a nation, it is not far beyond us. It is my prayer that government is awaken by this as it not beyond Ghana to overcome this situation”, He professed.
Source: Purefmonline.comII Hayford Tabi II 2022