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Tag: Food and Beverages Association of Ghana

  • MPs ignored the plight of citizens and approved new taxes – FABAG

    MPs ignored the plight of citizens and approved new taxes – FABAG

    The Food and Beverages Association of Ghana (FABAG) say they are very disappointed with Parliament’s decision to approve three new revenue bills of government.

    On March 31, lawmakers passed through the Excise Duty Amendment Bill 2022, the Growth and Sustainability Levy Bill, 2022, the Ghana Revenue Authority Bill 2022, and the Income Tax Amendment Bill 2022.

    While government believes the revenue bills are key towards clinching an IMF Board Level approval for a bailout and boosting domestic revenue efforts, the Food and Beverages Association has vehemently kicked against the decision.

    Spokesperson for the Association, John Awuni accused lawmakers of disregarding citizens’ cries and agitations while approving the revenue bills.

    “We feel very disappointed that the three tax bills were passed by the Parliament of Ghana, especially supported by the NPP MPs when no one was consulted on the new bills. We are disappointed in this action and the MPs must realise that they are representing the people of Ghana and not themselves,” Awuni is quoted by citinewsroom.com

    He further bemoaned the absolute disregard of the Association’s petition against the passage of the three revenue bills adding that a simple dialogue could have prevented the passage of the draconian taxes.

    “We petitioned the Speaker of Parliament, the Trade Committee, and the Finance Committee and even petitioned the Majority and Minority Leaders in Parliament, but Parliament still went ahead and passed the bills.

    He continued, “We could have all dialogued and found different ways of achieving results without hurting businesses, but they went ahead and approved the bills with impunity simply because they have the power and authority.”

    John Awuni however called on government to suspend the implementation of the new taxes and find alternative ways to rake in revenue to avert a collapse of businesses in the country.

  • Food and Beverage Association appeals to govt to disapprove 5% tax on beverages

    Food and Beverage Association appeals to govt to disapprove 5% tax on beverages

    The Food and Beverage Association of Ghana (FABAG) is up in arms over some tax proposals currently in Growth and Sustainability Bill.

    The Association’s Executive Director, John Awuni is urging Parliament to pull the brakes on the proposal as it will further deepen the woes of producers.

    The Growth and Sustainability Bill forms part of measures by the government to rake in GHS 2.2 billion for the country by the end of this year.

    However, the development will see taxes slapped on the profit before tax of companies and institutions operating in the country, including firms in the extractive sector, such as mining and upstream oil and gas firms.

    Mr Awuni says “if the government really has their ears on the ground and properly researched they will not go further to bring even 1% or 0.5% of any type of tax in the name of the fact that the companies will bear it.”

    “Companies will pass it on to the consumers. Consumers’ disposable income is very low so how can they afford it? So it goes back to the fact that the companies cannot even meet their budget or sales targets.”

    The taxes will be spread across three categories dubbed A, B and C who are expected to pay 5% on Profit before tax, 1% of gross production, and 2.5% of Profit before tax respectively.

    But ahead of its debate and possible passage, Food and Beverage producers are kicking against the bill over its propensity to kick many of its members out of business.

    According to John Awuni, many of their members are already reeling under the implications of the economic turmoil and another imposition will throw them out of gear.

    Speaking on Accra-based Citi FM, FABAG boss urged government to rather widen the tax net instead than worsen the burden on tax-compliant businesses.

    “So clearly what we are looking at is that let the government ensure that people who are outside the tax bracket [are roped in],” he said.

    Economists such as the University of Ghana Business School’s Prof. Godfred Bokpin are worried that excessive tax burden on the populace will impede the economic growth expected.

    Speaking on Joy FM’s Super Morning Show on Wednesday, he noted that there are already existing tax avenues that can be explored to generate more income for the nation.

    Prof Bokpin believed that the ineffective implementation of tax policies causes great loss to the nation.

    “You get the sense that the players in the economy are overburdened with taxes. When you interact with the private sector, and households you get that impression. In as much as we support the need to generate more revenue, we need to be mindful not to undermine private sector competitiveness.

    “To do so, we can increase domestic revenue without increasing existing rates or introducing new tax handles. Ghana’s VAT efficiency rate is around 45%.”

  • Reduce cost of power to curb beverage price hikes Association appeals

    The Food and Beverages Association of Ghana has called on government to halt any increases in the cost of electricity and water, to prevent another increase in the prices of beverages in the country.

    The remarks come on the back of recent increase in the prices of some alcoholic beverages by as much as 20% in the country, following a multiplicity of factors including the recent introduction and revision of some taxes and levies as well the increase in freight charges.

    Speaking to Citi Business News on the price increases, the Executive Secretary of the Food and Beverages Association of Ghana, Samuel Aggrey said producers will have no choice but to increase prices if the cost of production rises.

    “If you look at it, electricity cost is likely to go up which will affect industry for instance. So in order for them to break even, what we are saying to government is that they have to reconsider the rates for local manufacturers, with the possibility of subsidies or a reduction in electricity charges to help the companies break even. The same applies to the cost of water.”

    “If the increases are allowed it is likely that even before the middle of the year we will have a second increment again which will most likely affect the market,” he added.

    Source: Business Ghana