"Reduce Tax System": FABAG President Implores Government Following Multinationals Exit

"Reduce Tax System": FABAG President Implores Government Following Multinationals Exit

  • President of the Foods and Beverages Association of Ghana, John Awuni, has urged the government to redesign the tax system.
  • According to him, the taxes are high, and there are many nuisance ones in the system strangling the private sector
  • He said this has resulted in the rapid departure of multinationals from the country to neighbouring countries

President of the Foods and Beverages Association of Ghana (FABAG), John Awuni, has raised alarm about the recent migration of multinational companies from the Ghanaian market.

His concern follows the exit of Glovo, Jumia Foods, Société Générale, Dark and Lovely, Nivea and Bic Pens, among others.

FABAG president implores government following multinationals exit
The FABAG president said the high taxes in the country were stifling private sector growth.
Source: Getty Images

The multinationals had cited an unconducive business environment due to high taxes and operational costs as the reasons for their departure.

Awuni, speaking in an interview on Citi TV, pointed out that the numerous nuisance taxes in the country were chiefly responsible for making Ghana an unattractive place for doing business.

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He said difficulties due to high taxes had strangled the private sector.

He has called on the Akufo-Addo government to revise its tax model to prevent the departure of more multinationals and the collapse of indigenous companies.

John Awuni blamed the high taxes for the country's lack of economic growth.

According to him, when taxes are high, businesses cannot offer employment opportunities to the many graduates leaving universities across the country each year.

This has resulted in significant unemployment figures in the country.

He also said that high taxes mean producers have no choice but to raise prices, which in turn affects the purchasing power of consumers, further impoverishing Ghanaians.

The FABAG President also expressed great displeasure with the Growth and Sustainability Tax.

He said the practice where companies are forced to pay taxes on their losses is counterproductive and unacceptable.

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He said the only viable option for these companies is to leave.

Glovo exits the Ghanaian market

YEN.com.gh reported that the food delivery platform Glovo will end operations in Ghana on May 10, 2024.

The company cited profitability issues within the Ghanaian market as the reason for its early departure despite significant business expansion investments in the last two years.

This was contained in a memo shared with the company's network of restaurant partners via email.

According to the company, it will shift its resource investments to other countries where it operates to optimise service delivery.

Glovo is active in 23 other countries worldwide, including Morocco, Uganda, Kenya, Ivory Coast and Nigeria.

Source: YEN.com.gh

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