NDC GOVERNMENT IS BUSINESS UNFRIENDLY

Posted on: www.dailyguideghana.com

By William Yaw Owusu

Monday, June 9, 2014

A financial analyst, Sydney Casley-Hayford says the National Democratic Congress (NDC) – led government as “the most unfriendly to the business community.”

He said the introduction of the 17.5 percent Value Added Tax (VAT) and National Health Insurance Levy (NHIL) on non-core banking services “are unreasonable and ridiculous.”

The Ghana Revenue Authority (GRA) last Friday released a list of 32 fee-based services by the banks that would attract tax from July 1, 2014 but sections of the business community have raised concerns about the rationale behind the taxes on non-core banking services.

Contributing to Citi FM’s news analysis programme ‘The Big Issue’ at the weekend, Mr. Casley-Hayford said “this is the most business unfriendly government I have ever had to be alive to witness in this country; this is so bad.”

“Whoever it is who conceived or brought this up and thought they were doing government a service has really just blundered completely and they have blundered with the assistance of the Central Bank,” he complained.

He said the Bank of Ghana is supposed to be the custodian of ensuring that “the economy of this country is buoyant,” but wondered what had gone wrong.

He questioned why a customer should be charged for a Cheque Book and also pay VAT on the same cheque book.

“How can you charge me for giving me a Cheque Book; you want me to pay VAT on the amount that the bank charges as fees for work that it is normally supposed to provide!” he queried.

He hinted that he was preparing to go to court to challenge the idea of why a Goods and Services Tax was being hidden as a value added tax saying “we are going to go and challenge the whole idea of what actually a value added tax means and this is not value added tax; you do not add value to me by charging me more.”

Franklin Cudjoe, Chief Executive Officer of IMANI Ghana said the 17.5 percent VAT on the noncore banking services might discourage people from banking.

“What is the purpose of this, because clearly you are not encouraging people to go and do banking, you are not even encouraging technology…There is a policy disconnect,” he said.

Mr. He called for review of the law saying “I am not saying you shouldn’t charge but I think you can do it nicely; there are some services that obviously you want to impose certain taxes on. Do we even know the quantum of resources that would be generated as a result of these rules…?

“I do not see why we need newer taxes; it is not as if there is even any real growth within the banking sector to add value to my money… you get peanuts for long term investments and savings,” he added.