Suspension of 5% excise duty on locally manufactured plastic products …GPMA calls on the government

The Ghana Plastics Manufacturers Association (GPMA) has called on the government to immediately suspend the newly introduced five percent value added tax on all locally manufactured plastic products as members are currently facing high production costs.

According to them, about 92 percent of industries and companies rely heavily on plastic packaging and products, for which the tax would inevitably lead to a general increase in consumer prices.

During a press conference held in Accra yesterday, the Association’s President, Mr. Ebbo Botwe, stressed that the tax will impact various items such as plastic chairs and tables, data cables, water tanks, coolers, conduit pipes, electrical installations, jerry cans and other products.

This, he said, would create barriers for local manufacturing industries that would make it difficult for them to compete effectively with imported goods.

“In fact, the above products and many other products that we call flexible plastic currently account for only about 21 percent of our total production in Ghana.

Hard plastics account for around 79 percent of production. This perception has been around for a long time, so that when plastics are mentioned, only shopping bags and bags of pure water are involved. This is a mistake that must be corrected in the future,” he stressed.

Mr Botwe said that surprisingly, the Ghana Revenue Authority (GRA), which collects taxes on behalf of the government, did not inform the association before the implementation, stressing that such behaviour was not conducive to the business community.

He further said that, given the challenges facing the association, two plastics manufacturers in Togo are currently conducting simulation projects to consider the possible relocation of their production to Togo and the export of the finished products to Ghana.

“As of December 31, 2023, the 10 percent environmental excise tax has already raised over GH¢1.976 billion since its introduction in 2011. All this money was supposed to go into the Waste Control Consolidation Fund but to our knowledge, not even a single pesewa has been disbursed, so where will this new tax come from to burden our plight?”, MrBotwel lamented.

“Some manufacturing companies have already stopped production and sent their employees on mass furlough due to high exchange rates, high benchmark values ​​and high overhead costs at the opening.

After extensive consultation with our partners such as the National Association of Sachet and Packaged Water Producers, Ghana Union of Traders Association, Association of Ghana Industries and Food and Beverage of Ghana, we called on government to suspend the 5 percent excise duty,” Mr Botwe said.

BY BERNARD BENGHAN.