Corporations and small businesses do not do well in a cumbersome tax regimes. That is why corporations migrate and locate in less cumbersome and highly competitive tax regimes in the world.
I would have taught tax reforms ... read full comment
Corporations and small businesses do not do well in a cumbersome tax regimes. That is why corporations migrate and locate in less cumbersome and highly competitive tax regimes in the world.
I would have taught tax reforms would be the focus of this article, because your research should indicate to your outfit that winning Foreign Direct Investment (FDI) provides a boost to national economies, creating new jobs and tax revenue in the short term, and in the longer term improving productivity by helping to fund capital investment and making domestic companies more competitive.
Why are our governments not learning from successful countries like Ireland, Singapore and Belgium who have been enormously successful in setting up favourable tax and regulatory environments that have encouraged companies to set up regional headquarters in these countries. For example, Yahoo, Google, Apple, PayPal and Linkedin all have European headquarters in Ireland, and Asian headquarters in Singapore.
Both Ireland and Singapore offer low corporation tax rates compared to other countries in their regions, as well as attractive transfer pricing arrangements for international groups. Singapore also offers a number of tax incentives fo companies active in target sectors shipping, commodities trading, because of the country's entrepot economy; fund management and biotechnology.
However, Belgium top them all with FDI close to 91.4% of its GDP, and only third to US and China. Belgium achieved this by using tax legislation to attract international companies. Companies that fund their businesses through equity rather than debt enjoy huge tax reliefs in Belgium. In addition, the country has generous tax breaks for R&D and investments in capital goods, as well as fiscal incentives for hiring employees.
Why are Ghana's successive governments not learning from say, Ireland, Singapore or Belgium. Are our people in government just lazy or just stupid?
Just two weeks or so ago, I read with utter dismay that our Parliament has approved a huge 10 years tax holiday to APS, a company that won the bid to renovate Ghana ports, and another 20 years tax free on dividends paid to their shareholders. Isn't this madness? Corporations don't like paying taxes, and would do whatever it takes to evade or beat down taxes. This why smart countries like Singapore, Ireland and Belgium strategically use tax incentives to draw investments to create economic value for their people. In Singapore, companies that earn up to 300,000 Singapore Dollar (SGD) pay only 8.5% in taxes and companies that earn over 300,000 SGD pay 17%. Compare this rate to Ghana's 25% flat on all corporate profits.
Kwabena Yeboah 10 years ago
What is sad and unpardonable in Ghana's cumbersome tax regime was the fact that, the VP during the height of Ghana's development was none other than a tax Professor, John Atta Mills, who occupied the VP position from 1997 to ... read full comment
What is sad and unpardonable in Ghana's cumbersome tax regime was the fact that, the VP during the height of Ghana's development was none other than a tax Professor, John Atta Mills, who occupied the VP position from 1997 to 2001. He later became the substantive President from 2009 to 2012 until his death, and went to his grave with all this tax knowledge that would have boosted our economic fortunes and helped our people.
Professor Mills had every opportunity to share his knowledge in taxation as a tool for national development, and like many African scholars, did he know that what he taught his students had a practical application to nation building. Only God knows.
As far as I know, our President Mills who taxation for years at Legon performed diddly squat to improve Ghana's tax system, yet he was an eminent Ghanaian tax Professor.
If only they will listen.
Corporations and small businesses do not do well in a cumbersome tax regimes. That is why corporations migrate and locate in less cumbersome and highly competitive tax regimes in the world.
I would have taught tax reforms ...
read full comment
What is sad and unpardonable in Ghana's cumbersome tax regime was the fact that, the VP during the height of Ghana's development was none other than a tax Professor, John Atta Mills, who occupied the VP position from 1997 to ...
read full comment