Tax Analyst, Francis Timore Boi has indicated that government is unlikely to withdraw the Growth and Sustainability Levy after 2025 as promised.
Parliament on March 31 passed the three tax bills including the Growth and Sustainability Levy. President Akufo- Addo has since assented the bills into law.
Many in the business community including the Ghana Union of Traders’ Associations (GUTA) and the Importers and Exporters Association of Ghana have kicked against the taxes warning that they will affect business transactions.
Speaking to Citi Business News, Francis Timore Boi argued that the government keeps modifying the tax clause which gives an extension to the levy but keeps coming back to the system.
He further urged the relevant tax enforcing authority to establish a final “sunset clause” to the levy to clearly give businesses a better perspective of deductible taxes.
“Since 2001 we have had this type of law in our books, and this is about the 13th time Parliament is making changes to the Act. In 2001, it came as National Reconstruction Levy”, he said.
“If it is going to end in 2024, why make an estimate for the revenue that is expected? I think it is a huge revenue source for government and so it is unlikely that it will be withdrawn as stated in the law,” he explained.
“It is likely to be extended as it has been done since 2001. What I am expecting is that it should have a final Set off clause so that businesses can plan very well. As it is now, every time we see it being rolled over and it is about time that if we want to make it permanent let state so; for businesses to understand that this an additional levy that is payable and not something that we put in the law and when the time is due, we extend it”, he added.
The Growth and Sustainability Levy Act, requires banks, non-bank financial institutions, telecom companies, and firms working in the oil sector to pay 5% of their profit before tax to the state.