Communication - Press
Press Release - 2021 Budget: What Businesses Should Expect
The Chamber of Commerce and Industry France Ghana (CCIFG) organized its maiden Webinar for this year. The virtual event in collaboration with...
Friday 16th April 2021
The Chamber of Commerce and Industry France Ghana (CCIFG) organized its maiden Webinar for this year. The virtual event in collaboration with Spain-Ghana Chamber of Commerce, Ghanaian-Hungarian Business Council and the Ghana Netherlands Business and Culture Council was facilitated by KPMG and Deloitte Ghana. The platform gathered about 50 participants across sectors.
The event started with an opening keynote address delivered by Armelle SAE-JEANNE, Managing Director at CCI France Ghana welcoming all present and introducing the speakers for this event.
The first speaker, Gordon DARDEY, Tax Unit Manager at KPMG presented on the 2021 Budget focusing on the Tax Measures and Business Outlook for 2021. Dardey highlighted the Priorities and Strategic Pillars initiated by the government. Some of which include COVID-19 containment measures and vaccination, consolidation and completion of existing projects, implementation of the GhanaCARES programme, among others. Among the seven key areas for this year’s budget, the key area of focus was the implementation of the GhanaCares Programme. The speaker proceeded with the next item being Tax Measures – the types implemented and proposed by the government. Among the several tax measures initiated by government include the introduction of COVID-19 Recovery Levy, Sanitation and Pollution Levy, 30% Tax Rebates to selected sectors, suspension of second to fourth quarter income taxes for selected persons and review of Road Tolls. He further added that the impact of the 1% COVID-19 health recovery levy on business will lead to a marginal increase in the taxable base leading to a 1.125% increase in the effective VAT rate. The next item focused on the initiatives carried by some selected sectors. Under the financial sector (the insurance sector, the Ghana Stock Exchange) include initiatives such as mandatory insurance of imported goods with Ghanaian Insurance companies, introduction of mobile applications for securities trading, the establishment of the Domestic Credit Rating Agency, among others. Other sector initiatives by the Transportation, Health and Trade &Industry sectors include the introduction of cashless payment solution for public transport service providers, boost the pharmaceutical industry and set up an automotive manufacturing support centre and most importantly introducing a monitoring and evaluation programme. To conclude the first part of his presentation, Dardey mentioned some key risks that could threaten the success of the initiatives as stated above. These include the capacity of the private sectors to exploit opportunities, the ability to secure vaccines and achieve herd immunity and lastly the impact of fiscal measures.
The second part of the presentation was facilitated by Yaw APPIAH-LARTEY, Financial Advisory Leader at Deloitte Ghana. His presentation focused on Public Debt in Ghana. Appiah-Lartey commenced with an overview of the economy of Ghana highlighting the key economic indicators with nominal GDP at USD 66.5billion with a budgeted deficit of 16% as reported by the International Monetary Fund. According to the economic indicators from last year, it is projected that GDP should reach about 5% in 2024 with less grants and more taxes. The speaker proceeded to speak about the country’s debt profile dated from 2016 to 2020, in essence Ghana’s public debt accumulation. In 2020 public debt accrued USD 291.6 billion with GDP at 76.1% as opposed to a debt accumulation of USD 122.0 billion with GDP at 56.9% in 2016. In line with the country’s accrued public debt, Appiah-Lartey briefly mentioned the government’s debt management strategies including mainly diversifying the country’s revenue sources as well as its borrowing sources with focalization on domestic borrowing and international commercial (external) borrowing. In line with the above, there was an introduction the Debt Service Suspension Initiative (DSSI). The Debt Service Suspension Initiative is the suspension of debt service payment by bilateral official creditors by developing countries who request for it. According to the speaker, this initiative will temporarily ease the financing constraints and free up scarce money that can be instead used to mitigate the human and economic impact of COVID-19 crisis. About USD 5 billion has been delivered in relief to 40 eligible countries, which was effective from 1st May 2020 and should terminate by June 2021.
In his final remarks, the facilitator highlighted some recommendations in relation to the country’s current debt situation such as exploring alternative sources of borrowing, reducing the level of domestic borrowing, increasing accountability to check and improve the behaviour of borrowers and lenders.
In conclusion, participants had the opportunity to ask relevant questions in relation to the presentations by both speakers. This virtual event was the first of its kind for this business year, organized by CCI France Ghana with other key partners for its members within its network.
About Us: CCI France Ghana
The Chamber of Commerce and Industry France Ghana is an association of companies and professionals belonging to different sectors which aims at supporting, fostering, and enhancing bilateral trade and investment relations between French and Ghanaian companies. With over 20 business sectors represented, the CCIFG acts as a business support system to its members by providing information and business opportunities through informative events, market studies, product-market testing, prospective missions, and trade shows.
To contribute to business growth for members, CCIFG continues to organize events with its partners to share practical information and create a platform to establish new business partnerships. The Agro-processing Conference organized also contributes significantly to the global rising of activities in the France in Ghana network to enhance the existing bilateral relationship between the two countries.
Report compiled by:
Selasi AMENYEAWU
Business Support Services
CCI France Ghana
Download Mr. Dardey's presentation HERE . If you will like to contact him, you can do so via gdardey(@)Kpmg.Com
Download Mr. Lartey's presentation HERE . If you will like to contact him, you can do so via ylartey(@)deloitte.com.gh
Download the GRA document on the Implementation Of New Tax Policies in the 2021 Budget Statement and Economic Policy HERE.
