A major tax overhaul is brewing in Ghana’s mining sector, with the government proposing a 3% increase in the Growth and Sustainability Levy.
However, PricewaterhouseCoopers (PwC) is warning that this move could have devastating consequences for the industry.
According to Abeku Gyan-Quansah, a tax partner at PwC, the proposed hike is misguided.
“But let’s pause for a moment—I don’t support multiple tax rates. This is essentially a tax on production, and we already have a similar one in the form of royalties. Could we have simply adjusted the royalty rate instead?” he questioned.
Gyan-Quansah also expressed concerns about the long-term nature of such levies.
“Historically, we’ve seen so-called ‘temporary’ taxes remain in place for decades. Since 2000, successive governments have introduced measures that were meant to be short-term, yet they continue indefinitely,” he noted.
The debate surrounding the proposed levy hike has sparked concerns about the long-term sustainability of Ghana’s mining sector. With the government aiming to extend the levy’s sunset clause until 2028, stakeholders are worried about the potential impact on investment and economic growth.
As the government seeks to optimize revenue from the mining industry, PwC’s warning serves as a reminder of the need for careful consideration and collaboration with industry stakeholders. The outcome of this debate will have far-reaching implications for Ghana’s mining sector and the country’s economic development.