Adopt more sustainable, business-friendly tax policies - Traders to government

Correspondence from Ashanti region Members of the Ashanti Business Community have entreated government to adopt more sustainable and business-friendly tax policies to help optimize revenue generated. This, they said will widen the country's tax net and help with the pricing of goods and services on the market. They also urged government to take all its revenue at the point of entry for goods which are at the ports and domestic factories. Speaking at a press conference, Executive Secretary of Ashanti Business Community, Charles Kusi said, "The FMCG is one of the largest markets with the longest supply chain in Ghana. It has a high revenue turnover and as such assumed to be very profitable market. The industry is one of the biggest employing market in the SME space and holds about 80 percent share of all the markets in Ghana." "This perception has created a certain impression to governments as the first to go for revenue mobilization. Unfortunately, the reality is that the FMCG Market has one of the lowest gross margins across all other markets in Ghana and even beyond," he added. Mr Kusi further disclosed that the market gross hovers around GH¢5 to GH¢10 and it has one of the shortest survival rates in Ghana. He explained that the phenomenon was so because of myriad of challenges the market had been bedeviled with. "The most devastating challenges are high and unrealistic tax system, high cost of borrowing rate, low gross margin, high inflation rates and forex hikes," he said. This follows the closure of their shops at the Kumasi Central Business area over what businessmen describe as killer hikes in inflation and taxes, coupled with the cedi depreciation. The closure which started on Monday at Adum has also been extended to some other business areas such as Bantama and Asafo. According to them, the sad development introduced a compounded problem for their players and the fundamental truth is that businesses are unable to charge neither 6% nor 4% VAT on goods sold. "We have told government you are being short chain in the market because of the high non VAT compliance and non alignment of your VAT system with our market dynamics. We can all attest to the fact that government revenue has fallen below expectations this year. When government is unable to actualise its revenue targets from FMCG Market, they assume businesses are either evading taxes or are under declaring their sales invoices," he averred. Mr. Kusi continued that government's attempt to salvage the situation unfortunately vents its frustrations on some few identifiable businesses to make up to its revenue fall. He said the act is depleting their working capitals, indicating that government VAT policy is collapsing their businesses. "We are scared because day in day out, we see our businesses fallen apart. For how long should we sit unconcern do see what we have laborer for all these years go down because of government vat policy? Most scariest thing is whilst our businesses are going down, our economy is also going down faster than we can comprehend."

Correspondence from Ashanti region Members of the Ashanti Business Community have entreated government to adopt more sustainable and business-friendly tax policies to help optimize revenue generated. This, they said will widen the country's tax net and help with the pricing of goods and services on the market. They also urged government to take all its revenue at the point of entry for goods which are at the ports and domestic factories. Speaking at a press conference, Executive Secretary of Ashanti Business Community, Charles Kusi said, "The FMCG is one of the largest markets with the longest supply chain in Ghana. It has a high revenue turnover and as such assumed to be very profitable market. The industry is one of the biggest employing market in the SME space and holds about 80 percent share of all the markets in Ghana." "This perception has created a certain impression to governments as the first to go for revenue mobilization. Unfortunately, the reality is that the FMCG Market has one of the lowest gross margins across all other markets in Ghana and even beyond," he added. Mr Kusi further disclosed that the market gross hovers around GH¢5 to GH¢10 and it has one of the shortest survival rates in Ghana. He explained that the phenomenon was so because of myriad of challenges the market had been bedeviled with. "The most devastating challenges are high and unrealistic tax system, high cost of borrowing rate, low gross margin, high inflation rates and forex hikes," he said. This follows the closure of their shops at the Kumasi Central Business area over what businessmen describe as killer hikes in inflation and taxes, coupled with the cedi depreciation. The closure which started on Monday at Adum has also been extended to some other business areas such as Bantama and Asafo. According to them, the sad development introduced a compounded problem for their players and the fundamental truth is that businesses are unable to charge neither 6% nor 4% VAT on goods sold. "We have told government you are being short chain in the market because of the high non VAT compliance and non alignment of your VAT system with our market dynamics. We can all attest to the fact that government revenue has fallen below expectations this year. When government is unable to actualise its revenue targets from FMCG Market, they assume businesses are either evading taxes or are under declaring their sales invoices," he averred. Mr. Kusi continued that government's attempt to salvage the situation unfortunately vents its frustrations on some few identifiable businesses to make up to its revenue fall. He said the act is depleting their working capitals, indicating that government VAT policy is collapsing their businesses. "We are scared because day in day out, we see our businesses fallen apart. For how long should we sit unconcern do see what we have laborer for all these years go down because of government vat policy? Most scariest thing is whilst our businesses are going down, our economy is also going down faster than we can comprehend."