Real Estate: 5% VAT to make housing more expensive – Orel CEO

The Chief Executive Officer of Orel Ghana, Richard Mantho, has told Starr Business that the five percent Value Added Tax (VAT) imposed on the operations of the real estate industry could deal a blow to the quest towards reducing Ghana’s housing deficit.

Already some real estate developers have raised concerns about the imposition of the VAT.

Mantho has warned that continuous imposition of taxes on the housing sector could affect prospective home owners.

He said he expects the industry to be dulled this year mainly due to the 5% VAT.

“I expect a slow move…” he told Starr Business adding Real estate companies are more than likely to pass on the five percent VAT onto customers.

“It’s going to make properties expensive…I think that’s the main challenge we have now in Ghana. The properties are too expensive. Because it’s expensive to borrow money, it’s expensive to buy land and that’s the problem.

“So if we borrow cheaply and buy land cheaply, we can develop every place in Accra and then we’ll reduce the deficit,” Mantho said.