According to them, the country has not benefited much from such a regime as lot of companies who are given the incentives are multinationals who mostly repatriate their profits to their home countries.
Free Zones companies for instance enjoy up to ten years tax holiday.
Speaking to Citi Business News after a 2019 post budget forum organized by KPMG, Tax Consultant Abdallah Ali Nakyea said until the tax incentives regime is reviewed, government’s bid to raise more revenue may be flawed.
“Before you grant an exemption you must have a reason. Free Zones companies enjoy tax holiday to reduce their cost of production and in return bring in foreign exchange through their exports and also bring in their technical know-how. But what do we see? Not much. Are the exemptions bringing in the results we want?” he questioned.
According to him government can review the ten year tax holiday to 5 years to help government accrue more revenue through taxes.
“All exemptions should be relooked at, those that must be removed be removed and those that must be reviewed be reviewed,”.
On his part, Tax Partner at KPMG, Kofi Frempong Kore argued that the exemption regime does not favour Ghanaian owned companies.
Because the government cries for investments, so in most cases the government focuses on those coming in with some investments to the detriment of local companies who are investing in the resources here in Ghana,” he noted.
He said a situation where foreign companies enjoy reduced corporate taxes and sometimes exempted from PAYE taxes puts local companies who pay all those taxes into a disadvantage.
The KPMG forum is an annual event, designed to provide a platform for public discussion on economic and fiscal policies and government priorities as proposed in the annual budget.
By Nana Oye Ankrah/citibusinessnews.com/Ghana.