Dr Abu calls for more Foreign Direct Investment
Government proposes increase in VAT rate
BHC is Y2K compliant - Management
Government proposes increase in VAT rate
Accra (Greater Accra), 17th November 99
The government has initiated action to increase the Value Added Tax (VAT) rate from 10 per cent to 12.5 per cent from January next year.
An Amendment Bill to give effect to the increase would be laid before Parliament on Wednesday and is expected to serve as notice to the business community, a source at the Ministry of Finance told the GNA.
The Source said the increase has become necessary as a result of the recent decline in the prices of key export commodities, cocoa and gold as well as the sharp rise in the price of crude oil which has brought considerable pressure on Ghana's balance of payment account.
It said the situation has also highlighted the fact that cocoa farmers bear more than their fair share of the tax burden.
The source said in order to address shortfalls in government revenue, it is proposed to raise the rate of VAT, which distributes the tax burden more equitably.
It explained that currently while the formal sector pays less than 10 per cent income tax, cocoa farmers pay more than 25 per cent, adding that, in the event of cocoa price recovery, the relief would be enjoyed by the farmers.
Since the beginning of this year, prices of the country's major cash earners, cocoa and gold have recorded all-time low quotations, resulting in severe revenue shortfalls.
Out of 500 billion cedis projected receipts for cocoa up to next year, it is estimated that less than 50 billion cedis would be realised if prices do not recover on the international market.
While other major cocoa producers such as Cote d'Ivoire, have adjusted their producer price downwards, Ghana has maintained hers.
Gold for instance fell to an all-time low of about 250 dollars an ounce sending gold mining companies to take to hedging and other derivative measures to remain in production.
The Ministry of Finance in a recent statement to Parliament warned of hard times ahead and indicated the possibility of raising tax rates.
GRi
BHC is Y2K compliant - Management
Accra (Greater Accra), 17th November 99
The Management of Bank for Housing and Construction (BHC) said on Tuesday that the Bank has put in place a new technology system to facilitate smooth business at all its branches throughout the country.
A statement issued in Accra said the bank's computer hardware as well as the software are Y2K compliant and assured its customers that it would continue to render efficient service to the public without any interruption.
It expressed its appreciation to customers for their support over the years and re-assured them that it would continue to marshal resources in a bid to remain competitive and contribute effectively to the economic growth of the country.
Y2K is computer programming-flaw that represents dates with two digits instead of four, which might cause some computers to malfunction in 2000.
GRi