Euroget De- Invest S.A. (EDI), has appealed to the government to reconsider the ban on the tax waiver on goods and equipment procured for the construction of hospitals expected to increase hospital beds in the country by an additional 1,310.
Messrs Euroget De-Invest (EDI) S.A. of Giza, Egypt is implementing the project, which involves the construction and equipping of the nine hospitals, including a 500-bed hospital at Afari in Kumasi for the Ministry of Defence and eight hospitals for the Ministry of Health.
These include a 250-bed regional hospital in Kumasi and 160-bed regional hospital in Wa.
There are also six district hospitals at Salaga, Twifo Praso, Madina, Konongo, Nsawkaw and Tepa.
All nine hospitals are currently under construction and at various stages of completion.
By the terms of the Contract Agreement between Ghana and Euroget De-Invest, EDI shall be exempted from the payment of import duties, VAT and NHIS, ECOWAS levy, EDAIF, inspection fees and other related taxes on goods and equipment purchased for the nine hospitals.
Consequently, the tax exemption was granted by Parliament on December 23, 2016, however, this was put into abeyance by the new policy passed on March 13, by the Ministry of Finance.
The policy requires tax-exempt bodies to pay duties and taxes at the port and claim for refund upon submission of invoices and supporting documents.
Dr Said Deraz, Chairman and CEO of Euroget Group told the Ghana News Agency in Accra that since the Ministry of Finance introduced the new policy, his company has not been able to clear goods from the harbour because the financing arrangements for the implementation of the hospitals did not make any provision for this expenditure.
Meanwhile, the sheer scale of the project means that a lot containers of goods would keep on arriving and piling up at the harbour.
So far nearly 80 containers are presently at the Tema Harbour.
Dr Deraz said the more the goods stayed in Tema at the port, the more varied the implications would be for Ghana.
“The undue delay of the project creates a bad image for the Contractor, bad image for Ghana in the sight of the international community and eventually government would have to pay for the additional cost at the expense of Ghanaians who are waiting for the completion of the hospitals to enjoy the health services.
“There are alternative solutions for the stalemate, hence the need for all the parties involved to explore,” he said.
Mr Bernard D. Moro, General Project Co-ordinator of Euroget De-Invest said the containers were attracting huge demurrage and warehousing charges.
He said although the company had moved some of the containers to bonded warehouses and the company was arranging to do similarly for the rest and subsequent consignments in an effort to minimise the demurrage charges, there was nonetheless costs mounting on goods at the harbour on account of the new tax policy.
The policy is also causing delays to construction at the various sites which, in turn, is attracting additional cost in respect to ideal plant and labour and extension of time.
“If government does not change the policy, the project would surely suffer,” he added.
Mr Moro espoused the benefits of the hospital projects on the economy and improvement of healthcare delivery system that included the direct and indirect engagement of more than 2,000 people, high local content of the project through the selection of local contractors and the use of locally sourced materials, whenever available.
Although Euroget has promised to complete the construction and equipping of some of the hospitals by the close of the year and the rest in late 2018, the resulting delays are bound to prolong the timelines for project accomplishment.