Betting Tax; Taxing Multinational Companies in Ghana

Should betting tax be removed, reduced or replaced? That is the question. Preferably, it should be reduced from its current withholding rate of 10% to 3%, with some of the funds used to sponsor the Ghana Premier League. However, President Mahama intends to keep wholeheartedly his promise of complete removal; Thus, this article looks at possible replacement options.

5% FLAT TAX ON GROSS REVENUE
In the country’s quest to shore up revenue which would otherwise be lost from the removal of the bet tax, an option is the levying of a flat tax on the gross revenue on all multinational companies operating in the country. Since most non-Ghanaian companies operating in the country repatriate their income to their home countries, taxing the gross revenue is one sure way for the country to keep some of it here in Ghana. In addition, for all foreign companies in the extraction industry, which currently have a levy on gross production, the levy should also be increased to at least 5%.

The obvious counter argument to this would be those who say that the companies would all relocate. This assertion, which has historically been used to scare the government, is a complete and total falsehood. There are 2 major truths for all for-profit organizations.

1. Businesses Go Where They Can Make Money, Period
2. For any 1 foreign company that exists, more than enough are looking for entrance

STOP TAX-BREAKS FOR FOREIGN COMPANIES.

There is no way a country like Ghana should be looking to the IMF or any other foreign organization or country for loans less than $500 Million Dollars. Also,

No Foreign company should be incentivized with tax holidays. Ghana as country must be treated just like a For-Profit Company when it comes to dealing with non-Ghanaian companies who wish to do business in the country. The foremost question should always be the economic benefits those companies would bring.

In the country’s misconceived notion that these foreign companies would hire many Ghanaians and possibly develop the areas in which they operate, most of them are given huge tax incentives which is not available to the Ghanaian owned companies. Rather the companies, after all incentives via tax breaks, limit their hiring leading to no apparent dent in the Unemployment issue in the country. Many hired are also not adequately compensated.

CONCLUSION
Resetting Ghana’s Tax System to recoup more from those companies benefitting the most from their economic activities in the country is a must.

No foreign company is in Ghana for pure charity work. In fact, even those who engage in charitable donations mostly do so in return for reciprocal benefits.

God Bless Our Land Ghana! GYE-NYAME.

   Comments0