‘2018 revenue target challenging but achievable’

The Commissioner-General of the Ghana Revenue Authority (GRA) Mr. Emmanuel Kofi Nti is hopeful that with suitable revenue collection strategies, hard work and resilience of staff, its 2018 revenue collection target of GH¢39.8 billion will be achievable.
 

“The target is achievable on the back of hard work and the roll out of innovative measures in the course of the year. Yes, the journey may be daunting, but we believe with the introduction of adequate strategies we can surmount the hurdle,” said Mr Nti.

Speaking at a media Soiree in Accra to deepen the Authority’s relationship with the media for mutual benefit, Mr. Nti explained that the Electronic Point of Sales Device and the Excise Tax Stamp policies, which could not be implemented, last year would commence in 2018 and are expected to increase tax revenues, reduce the incidence of Value Added Tax (VAT) and Excise Duty suppression and monitoring of sales among others.

The Authority, he said will also this year implement the VAT Amendment Act, which requires the appointment of withholding agents by the Commissioner-General to withhold payment to a VAT registered supplier of seven per cent of the taxable value of the supply and remit same directly to the Commissioner-General.

“Let me be quick to add that all these interventions are not new taxes but compliance measures to ensure that all VAT/NHIL due to government is paid,” he said.

Mr. Nti said the GRA would roll out Total Revenue Integrated Processing System to the remainng 10 Domestic Tax Revenue Division offices during the first quarter of the year.

He said the Authority would also improve the infrastructure to ensure officers work in conducive environment while capacity-building programmes would continue to enhance professional performance.

On tax initiatives for economic growth, Mr. Nti said Tax incentives for Young Entrepreneurs, which seeks to grant tax holidays to entrepreneurs’ aged 35 years and income tax threshold to protect low income earners will be implemented.

Mr Nti said there also plans to introduce a Voluntary Disclosure Procedures in the Revenue Administration Act to waive penalty on voluntary disclosures and payment of unreported and understand taxes by taxpayers.

2017 revenue performance

In 2017, the Authority recorded a nominal growth rate of 22.3% over the 2016 collection figures.
GRA collected GH¢32.3 billion (GH¢32,313.37 billion), compared to the GH¢27 billion in 2016.

In 2017, the GRA was tasked to collect GH¢33,434.20 billion. As of the end of the year, the provisional collection figure is GH¢32,313.37 billion. This represents a shortfall of GH¢1.1 billion (GH¢1,120.83 million), a negative deviation of 3.4%.

In 2016, the GRA was charged to collect GH¢29 billion, but it was able to collect GH¢27.8 billion, recording a shortfall of GH¢1.2 billion.

Even though the 2016 target was not achieved, the revenue performance represents a nominal growth of 25.4 per cent.

Mr. Nti explained that when he assumed office last year, collection in terms of the US dollar was stagnant in the region of $6.8–6.9 billion. For 2017, he said, collection rose to $7.6 billion, representing a break from the trend.

Direct collection was GH¢13.2 billion (GH¢13,251.63), as against a target of GH¢12.8 billion (GH¢12,829.82 billion).

On the other hand, GH¢6.3 billion (GH¢6,368.00) of indirect taxes was collected, as against a target of GH¢6.6billion (GH¢6,660.72). The Customs Division was given a target of GH¢13.9 billion (GH¢13,943.66), but was able to collect GH¢12.6 billion (GH¢12,693.74).

The Authority really put up a sterling performance, especially in the last six months, but still fell short of the target marginally, Mr. Nti stated.

Ghana AirtelTigo inject liquidity to expand mobile money operation

AirtelTigo, a telecommunication giant is in serious discussions with some banks and business people to inject liquidity into its mobile money operations to drive expansion and promote transformation in the financial inclusion agenda, Bright Owusu-Bempah, Chief Finance Officer, has said. 

Industry operators have raised concerns that solving the liquidity management challenge is one of the next big issues facing mobile money providers around the world. 

 “With mobile money, we are talking to some new banks and financial institutions, we are also talking to businessmen, and people who are interested in driving the whole agenda of financial inclusion, to ease liquidity strain on our agents and customers.

At the moment we are putting finishing touches on some of the discussions. There is going to be huge transformation gap in our mobile money operations, where we hope that within reasonable ranges you will be able to have access to agents who will always get you your transaction processed,” Mr. Owusu-Bempah told Network of Communication Reporters (NCR) at a media interaction during a courtesy call on the management of the company in Accra. 

According to data from the Bank of Ghana from January to December 2017,   AirtelTigo recorded an amount of GH¢79 million accounting for 3.56 percent share of the mobile money deposits in the country. 

Mr. Owusu-Bempah explained that the company’s strategy is to leverage on the opportunity to effect fresh changes and that is what we are working on in the next couple of weeks. “What we are trying to do is to increase volumes and also support the Agents with liquidity. With our target it should be able to get to where we want to be.”

The Chief Executive Officer of AirtelTigo, Ms Roshi Motman assured that with the wider range of customers, after the merger, the company’s plans is to drive accessibility and liquidity to position the company as a viable entity in the mobile money value chain.  

“Another key piece of our strategy is going to be mobile money. Tigo Cash has a bunch of customers; Airtel Money has its customers and now we want to expand that footprint quite dramatically.”

“There are two things that are important from the customer perspective when it comes to mobile money, which is the accessibility, and agents having the liquidity to give out the money. We are going to be on top of our game so the business can thrive,” she said.   

She said that the merged entity has an extensive distribution network and it would focus on making things simpler, easier and better for customers.

“Our Mobile Financial Services will also be greatly enhanced with combined agent networks and platforms,”she said.

      
Ghana's Mobile money and accounts

According to data from the Bank of Ghana  amount of money mobilized outside the banking system through mobile money recorded GH¢2.3 billion ending December 2017,representing a growth of 84.6 percent over the December 2016 figure of GH¢1.3 billion. 

These funds mobilized through mobile money transactions are currently held by banks.

The data also showed that mobile money accounts reached 23.95million compared with 11.43million bank accounts as at end December 2017. Value of mobile money transactions was GH¢155.8 billion at end December 2017 showing a growth of 98.5 percent over December end position of GH¢78.5 billion in December 2016.

MTN came on top as having the largest share of deposits, accounting for more than 90 percent of mobile money accounts held at commercial banks. MTN as at October 2017 had GH¢2.1 billion representing 93.5 percent of deposits held at commercial banks.

Airtel/Tigo followed with GH¢79 million accounting for 3.56 percent share of the deposits. Vodafone had 2.52 percent of the market share with GH¢57 million deposits.

For some, the amount held by MTN makes a strong case for MTN in its quest to establish a “Digital Bank” soon in Ghana subject to securing the required regulatory approval.

Banks holding the accounts

Fidelity Bank led the pack in terms of the banks holding the largest share of mobile money deposits with GH¢583 million. ECOBANK had GH¢470 million, while CAL Bank held GH¢229m.

These were the top three banks out of the 19 banks captured in the Bank of Ghana data holding the mobile money deposits as at October 2017.

Direct jobs created by mobile money through engagement of mobile money agents was 194,688 in December 2017 compared with 136,769 in December 2016.

Analysts have argued that the Payment Systems and Services Bill, when passed this year, is expected to provide additional support for the deepening of the payment landscape by creating job opportunities for the youth, facilitating international inward transfers, providing convenience and choice for consumers.

Fishing industry in terrible shape

…growth sinks to -4.4 in Q2

The country’s fishing industry is currently on life-support, as figures by the Ghana Statistical Service (GSS) show that it is the only sub-sector of the agriculture sector that is currently experiencing contracting growth.

Quarter two GDP figures show that fishing sector growth has plummeted from 3.6 percent in the first quarter to -4.4 percent.

The sector has never grown above 3 percent since quarter four of 2011, when it grew by 9.4 percent. 

In 2014 growth contracted for the last three quarters, recording -1, -5, -1.9 respectively. It inched up to 1.4 percent in first quarter of 2015 and never moved above that till same period in 2016, when it grew by 1.7 percent and further dropped to 1.3 percent in the last quarter of that same year.

The GSS data underscores recent studies by other institutions which show that Ghana’s fishing industry is experiencing dwindling fortunes.

The Food and Agriculture Organisation (FAO) estimates that production from marine fisheries has been declining since 1999, from almost 420,000 tonnes to 202,000 tonnes in 2014. 

Total fish exports, the study adds, showed a peak in 2003 with the value at US$120million but declined sharply to US$44million in 2014.

The FAO study also states that imports have increased substantially in most recent years, reaching US$373million in 2013. As a result, the seafood trade balance moved from a US$33million surplus in 1997 to a US$319million deficit in 2013.

Again, according to the Minister of Fisheries and Aquaculture Development Mrs. Elizabeth Naa Afoley Quaye, the country currently has a deficit of over 60 percent production - importing over 600,000 metric tonnes of fish, as it produces less than 400,000 metric tonnes.

Contribution to economy

According to the GSS 2017 Integrated Business Survey II (IBES) report conducted in 2015, the fishing industry raked in a revenue of GH₵307million - representing just 5.6 percent of a total GH₵5.48billion recorded by the entire agriculture sector.

The crops sub-sector, on the other hand, raked in GH₵5.16billion, whereas forestry and logging recorded GH₵9million.

The same report indicates that out of a total number of 54,267 persons engaged by the agriculture sector, 2,415 are engaged in fishing - representing 4.4 percent.

Data from the Ghana Investment Promotion Council (GIPC) also estimates that the fishing industry contributes 3 percent to the country’s GDP; and about 10 percent of the population is engaged in various aspects of the fishing industry.

Challenges

The country is currently experiencing a depleting fish stock, with various reasons attributed to the phenomenon. 

One of the foremost challenges confronting the sector is illegal fishing, which is estimated to cost the economy about US$100million annually.

A study by the University of Cape Coast’s Department of Fisheries and Aquatic Sciences has also indicated that climate change is partly responsible for the country’s depleting fishing stock.

Again, a challenge is the use of illegal methods for fishing - with pair-trawling, bomb-fishing, and fish-poisoning leading the charge.

Another challenge is the lack of attention given the sector compared to other sectors.source:BFT