Bussiness
Ken Ofori-Atta addresses Ghanaians today on measures to reduce economic hardships
The Finance Minister, Ken Ofori-Atta, is expected to address Ghanaians on specific measures taken by government to put the economy back on track today at 1 pm.
He is expected to highlight the outcome of deliberations during the cabinet’s three-day retreat at Peduase lodge over the last weekend.
Some of the reliefs to be announced include reopening land borders, easing of Covid-19 restrictions, and measures to arrest the depreciating cedi.
Ghana’s current public debt stock stands at a staggering ¢341.8 billion with a corresponding debt to GDP ratio of more than 77% as of September ending 2021.
This means if the country should share this amount across the country’s 30.8 million population, everyone will owe approximately ¢11,000.
In terms of interest payments on our borrowings, Ghana has spent, on average, ¢147 billion, which is ¢47 billion more than our projected revenue plus grants for 2022.
Government’s response
President Akufo-Addo, while admitting the economy is in dire straits, says he is optimistic the challenges confronting the country will last for only a short while.
According to him, the country’s economic woes are not unique as other countries face similar setbacks.
“It is no secret that our economy is going through difficult times. It is also no secret that we are not alone in that exercise. The phenomenon that we’re facing applies to many parts of the world as well. But that doesn’t, therefore, mean that government is impotent in trying to find solutions.
“Our retreat which you referred to is in some way quite timely, because as a general rule, we have retreats each year every quarter, and this is the first one for this year. Fortunately for us, it coincided with these difficulties and the public anxiety about how the economy was going.
“It gave us, therefore, the opportunity of the three days to look at the depth, where the economy was headed, and what measures were necessary to be taken”, President Akufo-Addo stated during a meeting with the Council of State members on Tuesday.
The most prominent of the actions government is taking is the reduction of salaries of executive appointees by up to 30%.
Government has also announced it will pump an amount of $2 billion into the economy to curb the continuous depreciation of the cedi.
Meanwhile, the Bank of Ghana is expected to increase the policy rate to 17%.
Council of State members reduce allowances
Members of the Council of State have resolved to reduce their monthly allowances by 20% until the end of the year due to the country’s economic challenges.
According to the Chairman of the Council, Nana Otuo Serebour II, the move is to help them identify with Ghanaians amid the difficulties people are facing.
“Mr President, in tandem with your decision, we as the Council of State have also decided that we will reduce our monthly allowances by 20% until the end of this year. This move is our way of contributing our widow’s mite to our total efforts towards economic recovery,” he said.
Source: www.myjoyonline.com
Bussiness
Ghana’s GDP shows economy is fast recovering despite DDEP – Finance Ministry
Ghana’s Gross Domestic Product (GDP) indicates a rapid economic recovery despite global challenges and ongoing debt restructuring, according to the Ministry of Finance (MoF).
The Ministry in a statement today indicated that latest data from the Ghana Statistical Service (GSS), cumulative economic growth for the second quarter (Q2) of 2024 reached 6.9%, a notable increase from the 4.7% recorded in the first quarter of 2024.
The MoF statement further noted that, “The economy’s robust recovery is in response to the macroeconomic stability and growth interventions that government is pursuing under our IMF-supported Post Covid-19 Programme for Economic Growth (PC-PEG).”
According to them, the overall real GDP growth for the first half of 2024 rebounded strongly, with year-on-year GDP growth averaging 5.8% for the period, significantly higher than the 2.9% recorded in the same period in 2023.
By Edem Mensah-Tsotorme
Read full statement below
Bussiness
Facebook, Youtube, online trading companies must be taxed – Deputy Finance Minister
The Deputy Finance Minister Dr Alex Ampaabeng, has proposed that online trading companies should be taxed to bolster the economy.
He noted that these companies, both local and international, generate significant revenue from their Ghanaian clients, which underscores the necessity for taxation.
In an interview with Bernard Avle on Channel One TV’s The Point of View, Dr Ampaabeng pointed out various potential revenue sources for Ghana, including online businesses and content creation companies.
He questioned why other national companies operating in Ghana are taxed, but social media platforms like Youtube and Facebook, which run numerous advertisements, are not included in the Ghanaian tax system.
According to him, these social media companies earn profits from the advertisements they display, and online trading companies also generate income from the sale of their products and services.
He mentioned online trading companies such as Jiji, Jumia, and Tonaton, which he believes surpass all physical marketplaces in Ghana in size.
According to him, “I can’t think of a country which has not gotten a digital service tax system of some sort, so Ghana is long overdue. Just to make an example so that people will appreciate where I’m coming from. Go to Youtube and play a video, within one or two minutes, you are going to watch about two, or three adverts.”
“What it tells you is that Facebook or Youtube is making profits right here in Ghana. Go to your Facebook account, and you are going to see a number of adverts on your right, left. What it is telling you is that Facebook is making profits right here in Ghana and not being taxed. Meanwhile, there are companies operating in Ghana, for jurisdiction reasons, of course, that are being taxed,” he said.
The Deputy Minister added that “So then, it comes to the question of the application of our tax laws. Revenues generated in Ghana are subject to taxes. We have Facebook, TikTok and all those players, these are digital platform owners.”
He stressed, “Then we have the digital or market players, here we are talking about individuals who are using the digital platforms. We have Jiji, Jumia, Tonaton, these combined, are bigger than all physical marketplaces in Ghana. And it tells you the volume of transactions, that are going on there.”
He expressed his hope that individuals earning online profits from Ghanaian residents would be taxed.
“There are conversations ongoing, I wouldn’t want to pre-empt anything, maybe in the future, it might not be anytime soon, what I would like to see, is a Ghana where people who are earning all forms of profits in the country are subject to taxes. People who are trading online to Ghanaian residents, people who are generating revenue from Ghana are allowed to pay taxes,” he noted.
Additionally, he proposed a collaboration with the government to curb cybercrime by registering and verifying these online trading companies.
“We can have a system where the government engages these operators, so individuals will submit their Ghana Card and are registered and verified,”he concluded.
Source: Citinewsroom.com
