GPMA Issues Ultimatum to Government Over Controversial Tax on Plastic Products
The Ghana Plastic Manufacturers’ Association (GPMA) has urged the government to suspend the newly imposed five percent excise tax on the ex-factory price of all locally manufactured plastic products and packaging. The association calls for broader stakeholder consultations to find a mutually beneficial solution. They have given the government a one-week ultimatum to respond, warning that failure to do so will result in a one-day shutdown affecting over 30,000 workers.
At a press conference last Wednesday, GPMA President Ebbo Botwe criticized the Ghana Revenue Authority (GRA) for issuing demand notices and threats, requiring members to start filing for the new tax from June 21, 2024. Botwe argued, “GRA should stop coming after us until there is clarity on this ambiguous tax.” He highlighted that the association already pays a ten percent environmental excise tax on selected plastic materials at entry ports, and the new tax would be detrimental.
“This tax in its current form is obnoxious and retrogressive for manufacturing. It will be harsh on the common man as a wide range of industries whose products are consumed daily, including food and beverage, water, medicines, and manufacturing will be severely affected,” Botwe stated.
The press conference followed a similar appeal made on May 28 for the government to reconsider its decision.
Botwe noted that over 92 percent of industries and businesses in Ghana rely on plastics, and the new tax would increase overhead costs, ultimately affecting consumers. He warned that some companies had already relocated production to neighboring countries, exporting final goods back to Ghana. “Let me remind the government that the plastic industry gives direct employment to over 39,260 people, generates over 1.89 million jobs in plastic waste recycling, and 1.43 million jobs in the sachet and bottled water industry. Cumulatively, the plastic industry employs about 3.7 million, which is about 11 percent of Ghana’s population,” he said.
Supporting the GPMA’s stance, the President of the Ghana Union of Traders’ Association (GUTA), Dr. Joseph Obeng, criticized the government’s timing and lack of consideration for the public’s suffering. He highlighted the detrimental impact of the exchange rate on businesses and suggested that the government’s actions indicate a lack of care. Obeng stated that the plastic industry is one of the few thriving sectors but warned that the new taxes could cause businesses to collapse. He urged the government to listen and suspend the tax’s introduction.