Government ponders tax exemptions for agricultural inputs

The Minister of Food and Agriculture, Bryan Acheampong, has hinted that the cabinet is currently deliberating on the possibility of granting tax exemptions for the importation of agricultural inputs.

“The problem is, when prices go up, no matter what we do, our businesses are unwilling to bring prices down and that is the problem. Irrespective, I will do all I can to ensure your request is granted,” he stated during a meeting with the Peasant Farmers Association of Ghana (PFAG).

At the meeting held in Accra, the two parties discussed crucial matters influencing the sector’s growth, including granting tax exemptions for the importation of agricultural inputs.

While awaiting the conclusion of discussions at the cabinet level, Mr. Acheampong said his office has been actively approving requests for exemptions for such inputs by importers, disclosing that as at the beginning of this month, more than 60 exemptions had been granted.

The minister’s disclosure comes on the back of concerns raised by PFAG over the austere economic conditions brought about by the International Monetary Fund (IMF) bail-out.

PFAG’s Executive Secretary, Dr. Charles Nyaaba, told the B&FT that given the country’s unsatisfactory performance in food production, leading to rising food inflation, farmers had anticipated that measures would be implemented to enable farmers to enhance their output, ultimately boosting food supply and mitigating inflation.

“We were expecting to see radical measures that will ensure that the Planting for Food and Jobs policy delivers on its mandate; but that hasn’t happened. Instead, as part of the IMF conditions, the government took off tax waivers that the sector actors were benefitting from. For instance, we used to have tax waivers when you are bringing farm mechanisation products; tax waivers on fertiliser, imported seeds, agrochemicals and veterinary medicines. All these waivers have been taken out,” he stated.

He also said food prices, which continue to drive inflation up, will keep rising unless something is done to lower the cost of farm inputs.

Working together for food sustainability

Acknowledging the impact of the taxes on farmers, the Food and Agriculture Minister assured PFAG during the meeting of his resolve to work closely with the association and farmers across the country to increase yields and productivity.

He added that the ministry was implementing strategic measures to guarantee that farmers around the nation have access to inputs.

Onion crisis

The issues discussed at the meeting ranged from the current onion crisis – which has resulted in the lock-up of over 60 trucks of imported onions at the Benin and Burkina Faso border, the implementation of the PFJ phase two, and the implications of the new Tax Exemptions Act on the prices of agricultural inputs.

Addressing the onion issue and the plea by onion traders for the ministry to intervene to enable them to move their goods into the country, Mr. Acheampong asserted that the government’s preoccupation was to ensure enough production of onions locally to reduce and eventually stop its importation.

He insisted that while the government is concerned about the locked-up goods and is working diplomatically to resolve the issue, the priority of the ministry is to bring onion producers together and work out a modality that will address the current challenges preventing them from producing enough for domestic consumption.

He continued that the ministry has worked out modalities for the PFJ phase two, which is expected to be launched later in the month. It will address the major concerns of farmers. With an aggregator system, farmers will have access to seeds, fertilisers, extension services, mechanisation and post-harvest services, and will only repay the cost of these services after harvesting.

Responding to concerns of farmers regarding the criteria for the selection of the aggregators under the model, the minister assured that existing aggregators will not be crowded out due to this programme and that the ministry will continually work with the farmers to ensure that the right aggregators are selected for this programme.

He emphasised that the programme is inclusive and that all farmers, including youths, women and aggregators, will form an integral part of it.

Speaking on behalf of PFAG, Dr. Nyaaba was grateful to the minister for his unwavering resolve to work with farmers to improve the fortunes of the sector. He pledged his outfit’s cooperation and support to enable the government to achieve the long-term vision of ensuring food sufficiency in the country.

He also called on all farmers, value chain actors and service providers to join in helping to make Ghana a food hub in the sub-region.