TIG Post

Tag: 10% tax

  • Plastic manufacturers to halt operations in response to 5% excise tax

    Plastic manufacturers to halt operations in response to 5% excise tax

    Consumers nationwide may soon face reduced availability of essential plastic-packaged commodities, such as bottled and sachet water.

    This impending shortage stems from the Ghana Plastic Manufacturers Association (GPMA), which represents local industry players.

    They have issued a firm ultimatum to the government, demanding an immediate suspension of a newly imposed 5% excise tax on locally manufactured plastic products.

    The GPMA has cautioned that unless their demands are met, manufacturers are prepared to cease production for seven days to protest.

    Speaking at a press briefing, Ebbo Botwe, President of the GPMA, stressed the government’s need to reconsider its stance and urged for renewed dialogue with all stakeholders to avert potential economic repercussions from the proposed production shutdown.

    “We are appealing to the Vice President, Dr. Mahamudu Bawumia, to intervene in this matter because the effect of this consumer tax will really affect the masses. The common man and woman will suffer extreme hardship,” Botwe stated.

    He concluded by issuing a direct warning: “We ask the GRA to stop the harassment of plastic manufacturers, and we give the Ministry of Finance one week to respond to our request. If not, all plastic manufacturers will shut down production for at least one week, and we’ll have no choice but to send home over 30,000 workers.”

    President of the Ghana Union of Traders’ Association (GUTA), Dr. Joseph Obeng, echoed opposition to the new tax, urging the government to find alternative means to meet tax obligations without burdening local industries.

    “The government is being insensitive to the business community. Let’s defer the implementation of the excise tax. The timing is not right, and it’s not fair when businesses are already suffering from the effects of exchange rates,” Obeng argued.

    “This is not the time to impose another tax when so many taxes have already been imposed on us. Are we saying we do not care about the state of businesses?,” the GUTA president quizzed.

  • Dzata Cement received illegal tax waivers from Mahama – Majority

    Dzata Cement received illegal tax waivers from Mahama – Majority

    The Majority Caucus in Parliament has accused the previous Mahama administration of illegally granting tax exemptions to the cement manufacturing firm Dzata Cement.

    The Caucus claims that former President John Dramani Mahama, through executive authorization, designated several firms, including Dzata Cement, as strategic investors and provided them with tax waivers without seeking Parliamentary approval.

    Speaking to journalists in Accra on Thursday, May 30, Majority Leader Alexander Afenyo-Markin urged the Minority Caucus to support the government’s initiative to industrialize the economy by offering tax exemptions to companies under the One District, One Factory policy.

    “Dzata Cement was a company that benefitted from this unconstitutional and illegal tax incentives but we all know that by the imperative of the [1992] Constitution, it is only Parliament that can impose tax or waive taxation but some actions of the executive under certain rule of necessity, Dzata Cement was granted a tax waiver and we did not complain because we were told that Dzata Cement was a strategic investor.”

  • This is why foreign incomes of resident Ghanaians will be taxed

    This is why foreign incomes of resident Ghanaians will be taxed

    The Ghana Revenue Authority (GRA) has provided clarity regarding its decision to tax the foreign incomes of resident Ghanaians, citing the Tax Act 2015 (Act 896) as the legal basis.

    In a statement released on Monday, April 22, the GRA defended its decision and outlined the criteria for individuals affected by the tax.

    This decision was announced on Monday, April 15, as a replacement for the suspended VAT on electricity, which resulted in a revenue gap of approximately GH¢1.8 billion.

    According to the GRA, resident individuals for tax purposes encompass citizens with a permanent home in Ghana who reside in the country throughout the year, as well as those present in Ghana for at least 183 days within any 12-month period.

    Furthermore, government employees or officials posted abroad are also considered residents for tax purposes.

    To facilitate the tax rollout, the GRA has established a special window for taxpayers to rectify their records and declare any undisclosed incomes.

    The GRA emphasized the importance of utilizing this opportunity to regularize tax affairs for all eligible individuals.

    Below is GRA’s full statement.

    The Ghana Revenue Authority (GRA) has noted concerns raised by the general public on the tax status of individuals who earn incomes abroad and whether they are deemed by the Tax laws as “resident individuals” for tax purposes.

    In light of these concerns, it is important to clarify who qualifies as a resident individual for tax purposes.

    The legal definition of a resident individual for tax purposes is grounded in the Income Tax Act 2015 (Act 896), Sections 3 (2) (a), 103, and 111.

    Clarification of key details:

    Individuals considered resident for tax purposes:

    1. Are citizens with a permanent home in Ghana residing in the country throughout the year

    2. Are present in Ghana for at least 183 days in any 12-month period that begins or ends within the year

    3. Include government employees or officials posted abroad

    4. Are citizens temporarily absent from Ghana for not more than 365 continuous days who maintain a permanent home in Ghana

    To facilitate easier declaration and payment of taxes for resident individuals to report of undisclosed incomes, the GRA has opened a special window for taxpayers to rectify their records.

    All eligible individuals are strongly encouraged to utilize this opportunity to regularize their tax affairs.

  • Netizens respond to 10% tax on sports betting and lottery earnings

    Netizens respond to 10% tax on sports betting and lottery earnings

    Some Ghanaians have reacted to the government’s introduction of 10% tax on earnings from lotteries, games of chance winnings and sports betting at the point of payout.

    As part of the government’s efforts to expand the tax base and increase domestic tax revenue, gamblers should be ready to have 10% of their earnings withheld as tax should the president assent to a newly passed bill by Parliament.

    Multimedia Sports Journalist Fentuo Tahiri Fentuo explained the specifics of the aforementioned taxes, stating that they will be deducted from each individual’s winnings prior to payout.

    “In case you missed it by the way, there’s a new 10% tax on your winnings from betting slips. it will be deducted before the payout. Take note and stop fighting the betting companies,” he said in a tweet.

    Parliament passed three new tax measures during an extended sitting on Friday, March 31, 2023.

    The three new taxes are the Excise Duty Amendment Bill 2022, the Growth and Sustainability Levy Bill, 2022, and the Income Tax Amendment Bill 2022.

    The bills were presented to Parliament as part of government’s plans to raise about GH¢4 billion annually in domestic revenue mobilisation.

    They are also crucial to help secure Board Approval for the US$3 billion International Monetary Fund (IMF) Programme after a staff-level agreement was reached late last year.

    As part of measures to meet the criteria set by the IMF to qualify for a bailout, the government has completed tariff adjustment by the Public Utilities Regulatory Commission (PURC), Publication of the Auditor-General’s Report on COVID-19 spending, and Onboarding of Ghana Education Trust Fund (GETFund), District Assemblies Common Fund (DACF) and Road Fund on Ghana integrated financial management information system (GIFMIS).

    The government in justifying the introduction of the taxes said they are critical for recovery from the current economic crisis.