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Business News of Wednesday, 15 June 2016

Source: B&FT

Don’t run from taxes - Prof. Adei tells SMEs

Prof. Stephen Adei, Former GIMPA Rector Prof. Stephen Adei, Former GIMPA Rector

Former Rector of the Ghana Institute of Management and Public Administration (GIMPA) Prof. Stephen Adei has asked owners of small enterprises to desist from shunning their tax obligations, as it impedes the growth of their business.

Addressing proprietors of schools in a one-day seminar on financial management organised by the Christian Community Microfinance Company (CCML) in Accra, he indicated that any business that avoids taxes and thinks of expansion and improved productivity will “only be living in a fool’s paradise”.

He said: “Most businesses try to work undercover just to avoid taxation; but they will be living in a fool’s paradise if they don’t pay the requisite taxes on their business. Your business will grow to a certain level, but you might not get the needed investment to expand.

“Dodging taxes will go against you as an entrepreneur and also the business, because you cannot publish accounts or even go about the banks to seek financing; and that will force the business to stay at the micro-level forever.

“As a business person, your aim should be to move your business from the micro to the medium, and then to a large-scale; as for avoiding tax obligations, you can devise means to do that but it will be to your disadvantage in the long run.”

Professor Adei also encouraged participants of the workshop to embrace sound financial management in their enterprises, as this will help to move the business from the micro to macro level.

About 80 school proprietors drawn from various regions where the bank operates were taken through the fundamentals of financial management—including proper book-keeping and accounting principles.

CCML’s Head of Customer Experience, Ms. Vivian Asabea Ohene-Asare, told B&FT the workshop was part of the company’s strategy of empowering its clients to grow their businesses into profitable ventures by upholding prudent financial management practices.

She told the B&FT: “We are organising the programme for our clients, specifically school proprietors, to enable them manage their finances; this is part of the company’s strategy to empower our clients to be able to grow their business.

“As a financial institution, we don’t want our clients to always depend on facilities from the bank to grow their schools. We want them to make good profits so that they can save some and invest the rest.”

According Ms. Ohene-Asare, CCML believes that by boosting the proprietors’ financial knowledge they will grow their schools to become profitable -- and deposit more for the company to on-lend to new clients who want facilities to start and grow their businesses.