Adnan Adams Mohammed
A renowned entrepreneur has urged government to reserve a greater percentage of incentive packages under the One District, One Factory initiative for local companies so as to ensure their sustainability.
“The local economy create jobs and wealth so that is commendable. We have got to monitor how it is implemented if this is supposed to influence investments in the programme then I will want to anchor it on the domestic ownership equity of those factories. It’s the right thing to do to boost the local private individuals,” The CEO of the Private Enterprise Federation, Nana Osei Bonsu has said.
The entrepreneur also argues that, reserving majority of the projects in the hands of locals will also help in improving revenue from tax collection.
“The tax will come in the reverse angle so to me this is one of the best things that parliament has done over the period for the private sector and much more for the domestic investors”, Mr Bonsu has said.
Parliament has approved an incentive package and tax waivers for the one district one factory, 1D1F, policy despite opposition from the Minority. The package waives taxes on machinery and equipment for operators under the policy and includes corporate tax exemption for five years.
The Minority’s main argument against the package is that, “no amount is mentioned regarding the waivers which basically gives a blank cheque to the operators in terms of tax waivers”, but the Majority group insists all individual requests will be considered on a case by case basis and brought to Parliament.
An incentive package from the government for the operators of the One-district One-factory programme was earlier met with stiff opposition from Parliament’s Trade and Industry Committee.
The package, which includes tax exemptions and tax holiday periods of up to five years, among other things, was under consideration at the committee level after it was presented to the House earlier.
However, the Minister of Trade and Industry, Alan Kyerematen had defended the tax waivers for firms operating under the One District One Factory initiative.
“What we are doing in Ghana is probably the least we can do to support our private sector…why would we not put our private sector at the same level of competitiveness as others are doing?” the Minister said in an interview last week.
Meanwhile, Mr Bonsu has asked the government to publicize incentive packages given to companies under the One District, One Factory policy (1D1F). According to him, this will attract more investors to the policy.
“What government brings to the table, whether thirty per cent equity interest, whether granting of land or other incentives should be publicized, that we are not comfortable the way is been held in a closet and we think that there must be an articulated format for disseminating information because we think there are too many people talking about too many things.”
Nana Osei Bonsu observed that government ought to be clear in all its policy implementations, concerning the initiative in order to attract more investors.
There are currently 45 companies under the One District One Factory projects operational, out of 181 projects already on the drawing board.
Aside from 22 of the 181 projects, which are under construction, the remaining projects are set to commence implementation before the end of 2019.
The projects are set to commence by the end of 2019.
They include small scale processing facilities, common user processing facilities financed from sources ranging from local private finance initiatives (PFIs), African Development Bank (AfDB) and CNB facility.
Of the 181 factories on the drawing board, 52 of them are existing ones while the remaining 129 have been categorized as new
The incentive package which was approved by parliament waives taxes on machinery and equipment for operators under the policy and includes corporate tax exemptions for five years.