The Food and Beverages Association of Ghana (FABAG) has disclosed that Ghanaian consumers are burdened with excessively high indirect taxes and levies on a wide range of essential products.
In a press statement issued by the organization, it was revealed that consumers are subject to tax rates that can increase the cost of various items by up to 100%.
The statement provided several examples illustrating the startling price inflation due to taxes. For instance, a tin of evaporated milk, which costs ¢8.5 before taxes, is retailed at ¢15.5 after taxes, representing an 82% increase. Similarly, a bottle of beer, priced at ¢5 without taxes, is sold at ¢11 after taxes, reflecting a 120% increase.
A similar trend of significant price hikes due to taxes is observed across various goods, including spaghetti (110% increase), tin tomato (86% increase), a 50kg bag of rice (100-120% increase), and local chicken (130% increase).
Other goods affected by substantial tax-related price inflation include cooking oil (120% per box), used gas cookers (88% increase), canned sardines (109% increase), and car batteries (100% increase).
The high taxes have led to basic necessities, such as a bag of rice, surpassing the entire monthly income of low-income earners, including waiters and drivers.
John Awuni, the Executive Chairman of the Association, cautioned that the elevated taxation has negative repercussions for businesses and the economy. He noted that the reduced demand resulting from high prices leads to decreased sales volumes and production, ultimately impeding business growth and reducing government revenue.
Mr. Awuni advocated for substantial tax reductions and the elimination of certain taxes in the 2024 fiscal year budget. He argued that this would invigorate private sector performance, stimulate higher demand and sales, and counteract the current taxation policy that hinders growth and encourages smuggling.