Don't touch free zones - Sam George to GRA

The Member of Parliament for Ningo-Prampram, of the opposition NDC, Hon. Sam George, has issued a stern warning to the Ghana Revenue Authority (GRA).

The MP is asking the GRA to stay away from taxing free zones enterprises as part of its familiar 'Oliver Twist' ventures in raking more taxes.

He also argued that there are several ways the GRA could explore in meeting its revenue target and should never consider the free zones as one of its fat cows.

Sam George was speaking to Neat FM Morning Show Host, MacJerry, during an interview.

The Ningo-Prampram MP says The GRA should not even advance any plans to tax the free zones sector.

It would be recalled that the GRA issued a directive recently that effective 1st December all Free Zones shops will pay duty at the port.

This includes all duty-free shops that would have to pay customs duty and apply for a refund.

According to the Commissioner General of the GRA, Emmanuel Kofi Nti, the move comes in the wake of perceived abuse of the duty-free regime by most of these shops.

But, to Sam George who, appears to be incensed by the GRA's action, it will be tantamount to a clear violation of the purpose, vision and mission for which the Ghana Free Zones Authority was established way back under former President Jerry John Rawlings.

The concerned legislator advanced his argument based on an Act of Parliament – The Free Zone Act 1995 (Act 504), upon which the Ghana Free Zones Authority (GFZA) was established.

The Free Zones Act (1995) Act 504 makes it mandatory for the companies to export a minimum of 70 per cent of their products as part of measures to stimulate industrialisation under an import substitution regime.

“The Ghana Free Zones Authority has been mandated under the Free Zone Act 1995 (Act 504) to ensure the establishment of free zones in Ghana for the promotion of economic development; to provide for the regulation of activities in free zones and for related purposes. Therefore, the GRA's attempts to tax the free zones sector should be resisted and condemned”

He further warned that should the GRA implement the plan to tax the free zones, a future NDC government will reverse this bogus decision back to its non-taxable state.

GFZA, which was established on 31st August, 1995 is now headed by Mr. Michael Okyere Baafi, who happens to be the Executive Secretary.

The GFZA, has over the past years, been creating an attractive and conducive business environment through the provision of competitive free zone incentives and operation of an efficient “one-stop-shop” for the promotion and enhancement of domestic and foreign investment.

The GFZA has made significant impact with companies operating under the free zones enclave exporting goods.

This means that the exports of free zones companies outstripped their imports by more than 100 per cent.

The wide variation between the values of imports and exports of companies operating under the free zones programme had brought to the fore the impact that the free zones initiative had made on the country's balance of trade.

This year, there were 156 active companies operating under the free zones enclave, where tax exemptions were granted to the firms in return for increased exports.