Ghana businesses asked to take advantage of tax reforms to maximize returns

A tax consultant has asked business operators to take advantage of opportunities provided under the tax laws and reforms to boost returns on investment.

Mr. Isaac Nyame of IKERN and Associates, said to do this they would have to become abreast of the reforms and laws to reduce their tax burden.

He was speaking at a workshop jointly organized by the Private Enterprises Federation (PEF) and Konrad Adenauer Stiftung in Kumasi for private enterprises.

It provided the platform to discuss the impact of the tax regime on the private sector – review the opportunities, gaps and obligations on businesses as enshrined in the new income tax law.

Mr. Nyame said he found it deeply worrying that many businesses had had to suffer needless penalty payment and tax overpayment because of their lack of understanding of the tax laws.

The reforms, he noted, had provided an avenue for tax reduction and it was something, enterprises needed to fully exploit to grow.

He identified some of the variables in taxation as entity, location, time, and activity of the business enterprise and said these determined the tax rate.

Again, the reforms provide incentives by way of tax exemptions in respect of merger of companies, amalgamation and re-organization.

Mr. Nyame said those into agro-businesses could also see reasonable increase in returns with tax on their income now pegged at one per cent for the first five years.

He, however, harshly criticized the high penalties on tax defaulters and warned that these could cripple businesses.

He stated that tax penalties which ranged from 75 per cent to 125 per cent were just too high.

Nana Dr. Appaiagyei Dankawoso, President of the Ghana National Chamber of Commerce and Industry, admonished private enterprises to keep proper books to enable them to enjoy tax privileges.

He also reminded them to ensure tax compliance and cautioned against tax evasion.

Source: GNA