Industrialists give government thumps up
Accra, Aug. 26, GNA - Industry players have lauded the take-off of the Value Added Tax (VAT) deferment policy on imported raw materials, saying it had helped to improve their cash flow.
About 25 manufacturing companies are currently benefiting from the facility while 15 others are soon to join after the completion of the screening process by the VAT Service.
The Act 671, an amendment to the Value Added Tax Law passed in 2004, deferred the payment of VAT on imported industrial raw materials but its implementation took off barely four months ago. To qualify for exemption, beneficiary companies must be of good standing with the Association of Ghana Industries and must have submitted Vat returns as well as met an import to output ratio of 20 per cent.
In an interview with the Ghana News Agency at a business luncheon organised by the Association of Ghana Industries on Thursday, a cross section of the manufacturers said the policy shift was a significant step by government to encourage and boost the growth of the manufacturing sector.
The industrialists contended that the country could not develop without paying attention to the manufacturing sector, adding that the implementation of such good policies were key to enhancing the sector's expansion and increasing the level of employment. Mr Joseph Odartey Blankson, Commissioner of VAT Service, told the the government.
In this direction, the Service had to take time to develop elaborate mechanisms to safeguard the system from abuse. These included a tracking mechanism at the GCnet at the country's entry point where list of deferred imported raw materials were entered at zero rate and ensuring that the companies maintained a good accounting and record keeping system.
He said the Service had not met with any difficulty since it started the implementation. Mr Prince Kofi Kludjeson, President of the AGI, said the deferment policy was a big relief to manufacturers, who imported industrial raw materials for production.
He, however, asked the Government to pursue deliberate policies to encourage the growth of local companies, emphasising that the industrialists were not looking for protection but policies that could enable them to compete on equal footing with their counterparts elsewhere.
Mr Kludjeson expressed the hope that the Government would continue to interact with the industrialists to move the sector forward. The Minister of Finance, Mr Kwadwo Baah-Wiredu and heads of the revenue Agencies, who attended the luncheon, asked the business community to team up with the Government to facilitate development.