Tax on agro inputs a threat to agribusiness and food security – Analysts
CropLife Ghana together with the Chamber of Agribusiness Ghana, Peasant Farmers Association of Ghana (PFAG), National Seed Trade Association of Ghana (NASTAG) and the Ghana Rice Interprofessional Body (GRIB) have jointly held a press conference to urge Government to restore the tax exception on Agro-inputs.
The President on September 12, 2022 assented to the tax exemption Act 2022, Act 1083 which is meant to regulate the application of tax exemptions and create an exemptions regime for imported goods. However Agricultural goods and equipment were not included in the list of items exempted from imports duties, this analysts say contradicts government’s policy of transforming the economy through agricultural production.
Executive Director of PFAG, Dr. Charles Nyaaba addressing the Press said the delay in granting the tax exemption by the Minister of Finance upon the request by the Ministry of Food and Agriculture (MOFA) has a dire consequences for the Agric sector which is already battling with high input and machinery cost, high cost of shipment, depreciation of the cedi and high transport cost associated with high fuel prices.
“Most farmers in 2022 produced at a loss, some had to scale down their production and others sort alternative business. A situation that led to low food supply, high food prices contributing to a record high inflation of 54% in December 2022 and this situation will be compounded if taxes are further imposed on agro-based products”.
Dr. Nyaaba appealed to the Minister of Finance, Hon. Ken Ofori-Atta to as a matter of urgency speed up in granting the request from MOFA and grant exemptions to the agricultural commodities and that the Government and Parliament should take a second look at the Exemptions Act and take steps to include Agricultural goods and equipment which is key to the economic growth.
Representing the importers of Agro-Inputs, Mr. David Ansong, Managing Director-Rainbow Agrosciences reported that unlike first when total expense on imported goods at the Port was at a margin of 5%, now due to the exemptions they are now paying up to 20-25% which has increased production cost.
“Government should take note that we can just push the extra cost to the farmer but because we all want the Agric sector to grow we have kept patience and hesitated to increase Agro-inputs to make for the loss. Last year when the cost of Agro-inputs slightly moved up we observed maize production was affected and a lot of farmers went into Soya beans and other things because the cost of production was low. This also have the repercussion to affect the unemployment situation in the country because now for instance if I import less containers I will need less workers for work”.
The farmers were not left out as the President of Ghana Rice Interprofessional Body, Nana Adjei Ayeh II, urged the Agricultural Ministry to take full responsibility and push the Finance Minister to give the exemption. “This baffles me that as a Government that wants to grow the Agric sector and at the same time you are putting levies on Agro-inputs. It will get to a time no one will like to do farming anymore because currently we are struggling to make our margins and if these Agro-inputs companies want to double up their product prices how can we survive”, he bemoaned.
On their part, the Chamber of Agribusiness Ghana led by Mr. Anthony Morrison implored all stakeholders in the Agric sector to rise up and fight against the tax being imposed on Agro-inputs. He gave statistics that the current food security status of the country as we speak is -2% including imports and storage “and the situation worsened when the bank of Ghana removed support for imports on bags of rice.
“As an Agricultural country we shouldn’t be here doing Press conferences. We have about 20 clear days to the production season as such we should be having in stock more than 70% of all Agro input requirement of this country but this is not the case”.
Organizers of the conference, Croplife Ghana, led by the Programs Manager, Mr. Kadiri Rashad in an interview with the Press reiterated as an association that provides stewardship (safe-use training to farmers, input-dealers and the general public including Security bodies and the regulatory agencies) in a bid to promote the Agric industry, they deemed it fit to bring together all these stakeholders who are being affected by the tax exemption Act so together they can find lasting solution to the matter.
Members of CropLife Ghana that represented at the Press Conference included: Chemico Ltd., Yara Ghana Ltd., Dizengoff Ghana Ltd., BASF, Bayer WCA, RMG Ltd, Calli Ghana Ltd, Bentronics Products, Wynca Sunshine Agro, Corteva Ltd, Rainbow Agrosciences, Kumark Ltd, Bon Agro Ltd, Agrohao Ltd, Reiss & Co, Candel Ltd, Agrocrown Ltd, Adama West Africa Ltd, Jubaili Agrotech, Solevo Ltd., Oversees Warehouse Ltd., Afcott Ghana Ltd. and Crop Doctor Ltd.
Source: Ghana Business
