Business News of Wednesday, 5 May 2021
Source: Anthony Mensah, Contributor
The Bank of Ghana (BOG) kicked off its maiden Invited Speaker Series with a presentation on “Transfer Pricing and its Implications for Monetary Policy” by Dr. Josh Bamfo on Friday, 30th April, 2021. Participants included personnel of B0G, the Ghana Revenue Authority’s (GRA), non-governmental agencies such as the local IMF office and Universities.
Dr Josh Bamfo, arguably the foremost TP expert in the Africa Region who is the Global Co-Leader for TP Services at Andersen with responsibilities for Africa and Middle East, stressed on the importance of the GRA effectively plugging the loopholes in the Ghana tax system that can potentially be created by TP.
This is to help ensure that the Government achieves or exceeds its planned tax revenue for 2021 and going forward to help fund the planned capital expenditures that will help create jobs as well as the enabling environment for increased foreign direct investments (FDIs). This has become increasingly important and urgent now that Ghanaian businesses have access to a larger market via the Africa Continental Free Trade Agreement (AfCTA).
On the other hand, Dr Josh Bamfo stressed on the importance of the GRA not to be overly aggressive in their TP administration so as not to become a deterrent to FDIs, which can be counter growth at a time where job creation is critical to the success of the Ghanaian economy.
He also highlighted the need for local tax laws to ensure that the Government appropriately taxes e-commerce multinational enterprises (MNEs) that generate significant revenue from Ghana but may not be adequately taxed because they do not have physical presence in Ghana.
In general, participants recognized the importance of TP to align with an expansionary fiscal policy (FP) driven by the Ministry of Finance and an expansionary monetary policy (MP) driven by BOG to help revitalize the economy back to pre-Covid19 high economic growth rates.
The head of TP Department of GRA also stressed on the progress and success that the Department has chalked in their quest to plug the loopholes in the Ghana tax system potentially created by TP.
It was a highly enlightening technical session for all participants and we believe that subsequent sessions will be equally enlightening and will help influence Government MP and FP in a positive way to help achieve the high and sustained economic growth rate and job creation that most, if not all, Ghanaian citizens are craving for.