The Minority Leader in Parliament, Mr Haruna Iddrisu, has called for a law that will help identify personalities behind corporate entities that benefit from tax exemptions in the country.
Speaking at a joint symposium organised by the American Chamber of Commerce (AMCHAM) Ghana and the Ghana Association of Restructuring & Insolvency Advisors (GARIA) in Accra last Monday, Mr Iddrisu noted that in many instances, personalities behind corporate entities that benefited from tax exemptions were unknown to the relevant institutions mandated to supervise their activities.
He explained that the situation, which had prevailed for many years, undermined the fight for deeper transparency and accountability in the country’s corporate space.
His call comes at a time when the state is said to be losing billions of Ghana cedis from tax exemptions granted to companies in the country.
The situation has become so alarming, prompting the Breton Wood institutions to flag the phenomenon as a crucial issue that requires an urgent solution to save the country from further financial haemorrhage.
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“To really fight corruption, we need to lift the veil because there are many instances where many of these corporate entities register in tax havens and in the name of privacy of contracts, we are unable to determine who they are, yet the contract benefits persons whose veils have not been lifted.
That undermines the fight for deeper transparency and accountability,” he said.
As a result, Mr Iddrisu said Parliament must be interested in inculcating into the Companies Bill 2018, a clause that would “lift the veil” off persons behind corporate entities benefiting from tax exemptions in the country.
“With the Companies’ Code, we should be interested in who that corporate person is as properly defined as part of our quest to deepen transparency and accountability,” he noted.
Mr Iddrisu also observed that for the government to successfully combat corruption, “we should ask for deeper openness in knowing who is behind a particular company registered in tax havens.”
Under the rampage of corruption in the country “we know that some persons have benefited from the existence of these entities even when they are not known to be part of the entities”.
Cost of doing business
Mr Iddrisu further bemoaned the cost of transacting business in the country, explaining that it was too high and a disincentive for the growth of businesses.
“Transaction cost of doing business in Ghana is too high, including taxation, so when you have an import levy which now can be reduced to an import nuisance tax, that affects the cost of doing business and the ease of doing business,” he said.
Ease of doing business
Mr Iddrisu said a lot more must be done to advance the ease of doing business in the country.
For instance, he said, the Customs Division of the Ghana Revenue Authority (GRA) must be well resourced to enable it to work around the clock to serve the needs of businesses.
“Another thing that we must address is the Customs Division of the GRA because I cannot understand why Ghana Customs cannot work 24 hours in order to advance the ease of doing business,” he noted.
He said it was possible for the country to have an efficient port if the right reforms were made to the operations of the various regulatory bodies responsible for the activities at the ports.
“It is possible, we need to support it and more importantly, every government institution must appreciate that its primary role is to create an enabling environment for the private sector,” he said.
Delay in passage of bill
A former President of the Association of Ghana Industries (AGI), Mr Tony Oteng Gyasi, in his contribution to the discussions, said there had already been a lot on consultations on the bill to ensure that all interests and views of the public were represented adequately.
“We have been to all the regions and met all stakeholders.
Our consultant, who is internationally acclaimed, came to Ghana twice during the consultative process and we engaged all professional bodies, including doctors, accountants among others”, he said, adding that it was for that reason the committee that worked on the bill was confident of its sanctity.
Mr Oteng-Gyasi expressed the hope that Parliament would expedite action on the bill to enable it to help the process of ease of doing business in Ghana.
The symposium was on the theme: “Improving the Current Legal Framework to Enhance the Ease of Doing Business”.
Chaired by Justice Professor Samuel Kofi Date-Bah, a former Justice of the Supreme Court, it was organised to engage the leadership of Parliament on the need to expedite the enactment of the Insolvency Bill and the Companies Bill 2018 into law to augment efforts by government to create a more conducive business environment in the country.
When enacted, the Companies Bill will replace the Companies Act, 1963.