Local and small businesses must be provided with more tax incentives, at least for the first five years of the firms commencing operations, Economic Advisor at the United Nations Development Programme (UNDP) in Ghana, Dr Frederick Mugisha has recommended.
It was important to make policy interventions that will reduce the burden on both small and large businesses who register their companies.
In an interview with the Finder Newspaper, Dr Mugisha said there was a need for government to provide incentives for companies in order to transform and protect businesses in Ghana.
In addition to giving tax exemptions to foreign businesses to encourage Foreign Direct Investments (FDIs), local firms should also be supported and nurtured to grow.
He stated that when businesses come in for registration, government must provide the needed support to help them grow.
“Create incentives around businesses who are small and large when they register. In 5 years’ time, the tax would be more than you expected” Dr Mugisha stressed.
The economic advisor said businesses, especially smaller ones must be taught to understand the importance of record keeping.
He explained, “small businesses do not appreciate why it is important to keep records, they have to be taught so they can make a case when things go bad or right”.
Dr Mugisha said the UNDP was willing to work with government to transform tax holidays for the benefit of businesses and the economy at large.
Speaking on how strategic thinking could help businesses grow, he noted that when businesses come for registration, they shouldn’t be left only with the paper which shows they had registered and ends all conversations.
Rather, Dr Mugisha enlightened government to hold businesses as ‘new babies’ and ‘spoon-feed’ them with good policies and ideas that could help them stand the test of time.
He also stressed the need for government to help businesses know the strength of marketing as part of the process of formalization to help them expand, and prevent early doubt in the progress stage.
The UNDP economic advisor in Ghana urged government and the private sector to see the formalization process of businesses as a core element that would aid progress and productivity in the country.