The government has introduced eight tax reliefs to stimulate and sustain growth, while cushioning Ghanaians against current economic hardship.
Mr Ken Ofori-Atta, Finance Minister, announced the reliefs in the 2024 “Nkunim”- (Victory) budget, presented to Parliament today, Wednesday, November 15.
This is in response to calls by individuals and private sector operators for the government to include policies and programmes that would maintain economic stability and ensure better living conditions in the 2024 budget.
Among others, the government in the 2024 budget, extended zero rate of Value Added Tax (VAT) on locally manufactured African prints for two more years, as well as zero rate of VAT on locally assembled vehicles for two more years.
It also announced a VAT flat rate of five per cent to replace the 15 per cent standard VAT rate on all commercial properties to simplify administration of the tax handle.
The government waived import duties on the importation of electric vehicles for public transportation for a period of eight years, in addition to a waive on import duties on semi-knocked down and completely knocked down electric vehicles imported by registered electric vehicles assembly companies in Ghana, also for eight years.
To support agricultural and manufacturing sectors, the government granted exemptions on the importation of agricultural machinery equipment and inputs, medical consumables, and raw materials for the pharmaceutical industry.
There was also a zero rate VAT on locally produced sanitary pads, in addition to a grant on import duty waivers for raw materials for the local manufacture of sanitary pads.
Mr Ofori-Atta said there would be an introduction of a simplified tax return to promote voluntary compliance as part of the modified taxation scheme for individuals in the informal sector.
“This approach will make it easier for taxpayers to fulfil their tax obligations to the State,” he said.
The COVID-19 levy, which many asked to be scrapped, was maintained, while the Electronic Transactions Levy (E-levy), also saw no reduction in the one per cent rate, as requested by Ghanaians.
The Minister noted that the country’s quest to increase tax-to-gross Domestic Product (GDP) to about 20 per cent from the current 13 per cent was on course.
“In that regard, it is difficult to implement all the structural reforms and tax reliefs needed to immediately lower and/or eliminate certain tax handles,” Mr Ofori-Atta explained.
“However, I assure this August House, that we have heard, we believe in lower taxes for industry, and we are working at this aggressively with the Ghana Revenue Authority (GRA) and to be cemented with the standing committee of the Mutual Prosperity Dialogue,” he said.