Mr Abraham Koomson, the Secretary General of the Ghana Federation of Labour, has reiterated the need for the Government to reconsider some of its economic policies, saying over-taxation has worsened the country’s unemployment situation.
He said most companies were on the verge of collapse due to over-taxation, with some economic policies having negative effects on businesses, resulting in laying off workers.
Speaking at the Ghana News Agency’s Industrial News Hub platform at Tema on Friday, Mr Koomson said the three new taxes introduced by the Government: Excise Duty Amendment Bill 2022, the Growth and Sustainability Levy Bill 2022, and the Income Tax Amendment Bill 2022, would collapse the few businesses left and most people would be jobless.
‘‘It would be best if the Government prioritised creating more jobs rather than over-burdening companies with taxes…The targeted revenue to be accumulated may not be achieved if businesses are over-burdened with taxes,” he said.
He noted that some companies had stopped production to monitor the market trends and consumer reactions to the new taxes.
Government says the Growth and Sustainability Levy is to raise revenue for the growth and fiscal sustainability of the economy.
It is imposed on the profit before tax of companies/institutions and on production in the case of mining, and upstream oil and gas companies.
The estimated revenue for 2023 is approximately ¢2.26 billion. The levy is subject to review by the finance minister in 2025.
The amendment to the Income Tax Act, 2015 (Act 896) is to revise the rates of income tax for individuals and introduce an additional income tax bracket, introduce a withholding tax rate on the realization of assets and liabilities and winnings from lotteries, among other things.
It is also intended to increase the optional rate for individuals on the gain from the realization of an investment asset, revise the upper limits for the quantification of motor vehicle benefits, and increase the concessional income tax rates.
The object of the Excise Duty Act, 2014 (Act 878) is to revise the excise tax rates for cigarettes and other tobacco products to conform with the ECOWAS Protocols and raise revenue to mitigate the harmful effects of these excisable products.
It is also intended to increase the excise duty in respect of wine, malt drinks, and spirits and impose excise duty on sweetened beverages, electronic cigarettes, and electronic liquids to increase revenue.
