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Business News of Thursday, 23 July 2020

Source: Ghanaian Times

Parliament grants Kasapreko company over US$28m tax waiver


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Local alcoholic and non-alcoholic beverage manufacturing company, Kasapreko Company Limited, has been granted a US$28,251,258 tax waiver, for the procurement of machinery, equipment and raw material for the revival of the defunct Paramount Distilleries.

Under the government’s flagship industrialization programme, One District One Factory, the waiver is the single largest to be granted any firm under the policy.

A subsidiary of the state beverage firm GIHOC Distilleries, Paramount Distilleries, located in Tanoso, in the Ashanti Region, if reactivated under the programme is expected to create 300 direct jobs.

Chairman of the Finance Committee, Dr. Mark Assibey-Yeboah, moving the motion of the committee in Parliament, yesterday, told the House that the decision was in line with the government’s policy to bring back to life Ghanaian firms, which needed the support of the state to return to production.

This, he said, would help realize the industrialization dream of the country from the economic quagmire of relying on imports from the East and West for production and consumption.

Seconding the motion, the Member of Parliament (MP) for Adaklu, Governs Kwame Agbodza, said it was a good thing to do if local firms could be supported to expand and create jobs and wealth for the teeming unemployed Ghanaian graduates.

He expressed concern over failure by the Finance Minister to bring before the House legislation to stop tax waivers and rather give only tax rebates as promised.

Asikuma-Odoben-Brakwa MP and Vice Chairman of the Committee, Anthony Effah, contributing to the motion, said 1,800 indirect jobs were expected to be created through the revival of the company.

With the rehabilitation of the project, Mr. Effah said “the local economy of Tanoso is going to be revived” to the benefit of the entire country.

Ras Mubarak, MP, Kumbungu, urged that at a time of a global pandemic, coronavirus, health, and wellbeing of the people should be the focus rather than encouraging the use of alcoholic beverages.

“As we all seek to have a productive country where the young men and women are healthy and strong, we need to mindful of products that may affect their wellness,” he said, urging Kasapreko to focus on environmental sustainability to ensure that packaging of products did not add to the environmental challenges the country was grappling with.

The Minority Leader and Tamale South MP, Mr. Haruna Iddrisu, said the amount involved in the tax waiver was high, and asked the government in the future, to consider having an equity interest in such ventures.

On behalf of the Majority, Alexander Afenyo-Markin, MP, Effutu, said the call for an equity interest in firms based on the percentage of tax waivers was simplistic because “once the waiver is given, the reinvestment of those gains in the company for employment and expansion is the real effect of the waiver.

“If the government is to have equity and that equity will amount to nothing, by encouraging the private sector to employ more Ghanaians will benefit the country in the long term because the government will get taxes from the employees and that will still be again.

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