The Ghana Federation of Labour (GFL) has called on government to halt the passage of the Excise Duty Amendment Bill 2022 for further stakeholder engagement.
It said the passage of the Bill, which is an amendment to the Excise Duty Act 2014 (Act 878) would increase the operational cost of local beverage manufacturers, which could inadvertently lead to downsizing of operations and laying off of workers.
Addressing the media, Mr Abraham Koomson, Secretary General of GFL, said introducing new excise duty at 20 per cent for non-alcoholic sweetened beverages, from 17.5 per cent to 20 per cent excise duty on mineral water, 45 per cent of duty for wines, including sparkling wine and 50 per cent for spirits, all at ex-factory prices, was not appropriate.
“The proposed 50% excise duty on spirits can be imposed on imported spirits only to allow local industry to grow.”
“Maintain the current excise duty on malts but exempt mineral water from the excise as the beverage industries have been under pressure from the harsh business climate,” he said.
Mr Koomson noted that even though the rationale of increasing excise duty was to generate revenue, the effort would increase the cost of production, which would be transferred to the final consumer.
“Indeed, if the principle of introducing cost to discourage consumption and its adverse consequences hold true, increased cost will as well lower demand and, therefore, the expected revenue projection is not likely to be realised,” he said.
He urged government to collaborate with industry players to engage, assess and identify the needed interventions most effective in promoting good health, sustaining livelihoods and aiding government generate needed revenue.
“We cannot afford to sit on the fence and watch our members reel under the ever mounting taxations on local manufacturing industry,” he added.