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Luxury tax yields GH¢21.3m in 5 months

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The government has collected some GH¢21.3 million in taxes from the use of vehicles with engine capacities of 2.9 litres and above between August and December last year, provisional fiscal data on public finances for last year has shown.

The amount is GH¢82.7 million or 79.52 percent below the GH¢104million that was projected to be collected within the period. The projections were contained in the 2018 mid-year budget review.

The implementation of the vehicle luxury tax begun in August 2018 as a new policy to help raise more revenue.

A Fiscal Policy Specialist at Oxfam Ghana, Dr Alex Ampaabeng, in an interview with the GRAPHIC BUSINESS on April 9 in Accra observed that the development brought to the fore the country’s inability to undertake proper consultation before a new system or initiative was introduced.

“The revenue collected, although is very low compared to government’s projection, offers a foundation for future decisions and most importantly, a basis for national conversation around this tax.

“It is a strong untapped revenue potential that must be pursued but must be well administered,” he said.

According to him, the government was overly ambitious about its targets, especially considering the fact that this was a new levy.

“I do wonder though if the government based its projections on accurate records of taxable vehicles in the country.

If this is indeed the case, then it is very surprising that it had almost 80 percent shortfall.”

The fiscal policy specialist indicated that the government did not provide enough time and appropriate education before the introduction of this levy.

“Tax knowledge greatly influences tax compliance and the government did very little to improve people’s knowledge about this levy.

“A poor understanding of a particular tax is also likely to have broader implications as uninformed taxpayers may be more prone to seeing the new tax as unjust and might misperceive the benefits of paying it,” he added.

Govt challenged The Chairman of the Vehicle and Asset Dealers Association of Ghana (VADAG), Mr. Eric Boateng, in an interview with the paper last week observed that the figures had been authored to show that vehicle users and owners were complying with the levy.

He explained that a preliminary assessment by the VADAG at the Driver and Vehicle Licensing Authority (DVLA) had shown a lower turnout by vehicle users.

“Because we have called for the removal of the levy, the government have deliberately authored the figures to show the public that it is actually benefiting from the tax but in reality the situation is different,” he said.

He said vehicle owners have given a two-week ultimatum to the government to act or face their anger, adding that they were prepared to embark on a series of demonstrations across the country if the government failed to listen to their plea.

According to him, more than 5,000 supposed luxury vehicles have been parked in various garages across the country as prospective buyers have refused to buy them because they were trying to avoid the levy.

According to him, those who went for loans to import their cars are unable to pay back and are being harassed by their bankers.

Also, he indicated that other car dealers have not been able to pay their children’s school fees because their investments were locked up.

About the tax

However, attempts by the paper to elicit responses from the Driver and Vehicle Licensing Authority (DVLA) proved futile after several days of the attempt.

The vehicle luxury tax was introduced by the government in August 2018 as a new policy to help raise more revenue.

Vehicles with engine capacity of 2950 to 3549 Cubic Centimetres are required to pay GH¢1,000, while those with engines between 3,550 to 4049 cubic centimeters pay GH¢1,500.

Vehicles with engine capacities above 4049cc are to pay GH¢2,000.

The tax also affects vehicles of the listed capacities existing prior to the passage of the law.

Exempted from the levy are; tractors, ambulances, commercial vehicles that have the capacity to transport more than 10 persons and commercial vehicles for the transport of goods.

Other exemptions as may be prescribed by the minister responsible for Finance.

Dr. Alex Ampaabeng, Fiscal Policy Specialist, Oxfam Ghana

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World’s richest man Elon Musk buys Twitter in a $44 billion deal

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Elon Musk buys Twitter

World’s richest man Elon Musk buys Twitter in a $44 billion deal

Elon Musk has sealed a deal to buy one of the world’s influential social media companies Twitter Inc (TWTR.N) for US$44 billion cash on Monday 25th April 2022. This landmark transaction transfers the control of the social media platform populated by millions of users made up of celebrities and global leaders to the world’s richest man.

It is a seminal moment for the 16-year-old company, which emerged as one of the world’s most influential public squares and now faces a string of challenges.

Musk, who calls himself a free speech absolutist, has criticized Twitter’s moderation. He wants Twitter’s algorithm for prioritizing tweets to be public and objects to giving too much power on the service to corporations that advertise.

Political activists expect that a Musk regime will mean less moderation and reinstatement of banned individuals including former President Donald Trump. Conservatives cheered the prospect of fewer controls while some human rights activists voiced fears of a rise in hate speech.

Musk has also advocated user-friendly tweaks to the service, such as an edit button and defeating “spam bots” that send overwhelming amounts of unwanted tweets.

Discussions over the deal, which last week appeared uncertain, accelerated over the weekend after Musk wooed Twitter shareholders with financing details of his offer.

Under pressure, Twitter started negotiating with Musk to buy the company at his proposed $54.20 per share price.

“Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Musk said in a statement.

Former Twitter CEO Jack Dorsey weighed in on the deal late on Monday with a series of tweets that thanked both Musk and current Twitter CEO Parag Agrawal for “getting the company out of an impossible situation.”

“Twitter as a company has always been my sole issue and my biggest regret. It has been owned by Wall Street and the ad model. Taking it back from Wall Street is the correct first step,” he said.

The Twitter transaction was approved by the company’s board and is now subject to a shareholder vote. No regulatory hurdles are expected, analysts said.

Daniel Ives, an analyst at Wedbush, said the company’s board of directors had its back “against the wall” once Musk detailed his financing package and no other bidders emerged.

Although it is only about a 10th of the size of far larger social media platforms like Meta Platforms Inc’s (FB.O) Facebook, Twitter has been credited with helping spawn the Arab Spring uprising and accused of playing a role on Jan. 6, 2021, storming of the U.S. Capitol.

After Twitter banned Trump over concerns around incitement of violence following the U.S. Capitol attack by his supporters, Musk tweeted: “A lot of people are going to be super unhappy with West Coast high tech as the de facto arbiter of free speech.”

Trump, whose company is building a rival to Twitter called Truth Social, said in a Fox News interview on Monday that he will not return to Twitter.

The White House declined on Monday to comment on Musk’s deal but said President Joe Biden has long been concerned about the power of social media platforms.

“Our concerns are not new,” said White House spokesperson Jen Psaki, adding that the platforms need to be held accountable. “The president has long talked about his concerns about the power of social media platforms, including Twitter and others, to spread misinformation.”

 


Culled from: REUTERS

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Nigeria commits to pay off US$28.7 million capital arrears in Shelter Afrique

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Nigeria Finance Minister Dr Zainab Shamsuna Ahmed and Shelter Afrique MD Andrew Chimphondah

Abuja – January 11, 2022: The Federal Republic of Nigeria has pledged to pay the full capital arrear of US$28.7m in Shelter Afrique, Nigeria’s Finance Minister Dr. Zainab Shamsuna Ahmed disclosed at a meeting with Shelter Afrique Group Managing Director and CEO Mr. Andrew Chimphondah in Abuja.

The Minister further disclosed that the payment will be made in four installments starting January 2022.

In September 2020, the pan African housing development financier received US$$9.4 million from Nigeria. The contribution moved Nigeria to become the second-largest shareholding in the organization with 13.27% of the shareholding, behind Kenya with 17.78%, and ahead of the AfDB at 12.83%.

Lauding the government of Nigeria for its show of confidence in the institution and a stamp of approval for the organisation’s financial turnaround, Mr. Andrew Chimphondah said, “This is a major milestone which is set to propel Nigeria to become the largest shareholder in Shelter-Afrique when the country meets its capital commitment. This is a strong testament of the strong shareholder commitment and support of the Shelter Afrique Board and Management.”

Housing Bond

Shelter Afrique is planning to raise 250 Billion Naira Bond (US$500million) in 2022 to support its affordable housing projects in Nigeria. The Company is set to commence the road shows with prospective investors in January 2022 and is expected to conclude fundraising by end of February.

Shelter Afrique has embarked on a defined strategy of developing and deepening local capital markets so that access to local currency which is competitively priced can be made available to Nigerian Developers from the Real Estate Developers Association of Nigeria (REDAN), Large Developers and Tier 1 and Tier 2 Banks and Primary Mortgage Lenders. The significance of this is that Shelter-Afrique will have been successful in dealing with the foreign exchange exposure risks that have crippled many African countries caused by the weakening of local African currencies against hard currencies such as the United States Dollar and the British Pound Sterling,” Mr. Chimphondah said.

Thanking the Finance Minister Dr. Zainab Shamsuna Ahmed for supporting the Bond Issue by the approvals received on critical waivers from the Ministry of Finance, Mr. Chimphondah noted that Nigeria was a critical and strategic market for Shelter Afrique, adding that the fund realized from the bond issue will go a long way in address the affordable housing shortage in the country, now estimated at 17 Million Units against the continent’s 56 million units.

“As a response to addressing this housing shortage, Shelter Afrique will implement a transformative strategy that will crowd in additional capital funding into the low cost large scale affordable housing market in a commercially viable manner,” Mr. Chimphondah concluded.

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Yaw Amoateng Afriyie appointed Deputy CEO of GIPC

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Yaw Amoateng Afriyie

The President of the Republic of Ghana, Nana Addo Dankwa Akufo-Addo, acting under Section 17 (3) of the Ghana Investment Promotion Centre (GIPC) Act 2013 (Act 865), has appointed Yaw Amoateng Afriyie as the acting Deputy Chief Executive Officer of GIPC.

Amoateng Afriyie’s appointment is subject to the constitutionally required advice of the governing board of GIPC in consultation with the Public Services Commission.

GIPC –  Ghana Investment Promotion Center

GIPC is Ghana’s principal investment agency. Its functional mandate is to attract, promote and retain inward investment into Ghana to stimulate wealth creation and unlock opportunities for the private sector.

Amoateng Afriyie will assist the newly constituted board and the chief executive officer, Yofi Grant, together with the existing management to ensure that Ghana’s post-COVID-19 recovery is anchored on competitiveness, innovation and the board’s broader objectives.

These investment objectives align with Ghana’s international obligations.

Profile of Yaw Amoateng Afriyie

Before his appointment, Amoateng Afriyie worked in various senior capacities in the UK and Ghana as a management and political risk professional. He has considerable experience in commercial, tactical and strategic risk assessment in relation to business and investment in sub-Saharan Africa.

Until recently, he was the managing director of Elmina Advisory Ltd, a Ghana-focused government affairs consultancy advising blue-chip companies and global consultancies to assess opportunities and manage the impact of politics and policy, macroeconomics, and security in Ghana.

He has also worked as West Africa head at Africa Matters Ltd (AML), a London-based Africa-focused consultancy; a research analyst in the international office of the campaign headquarters of the Conservative Party UK; a researcher at Africa Practice, London; an external consultant at the global business advisory firm FTI Consulting; and a freelance contributor on anglophone West Africa at the Economist Intelligence Unit (EIU).

Amoateng Afriyie holds a postgraduate diploma in global business from the Saïd Business School of the University of Oxford, a Master’s degree (MA) in conflict resolution in divided societies from King’s College, University of London, and a Bachelor of Arts with Honours in politics and international relations from the University of Kent, Canterbury, also in the United Kingdom.

He is an enthusiastic amateur golfer who plays to a handicap of 12. He is equally passionate about the arts, including the music of various genres, current affairs, and sports, including football and Formula 1 racing.

GIPC has recently been adjudged the best investment agency in Africa three consecutive times by Capital Finance International magazine (CFI.co).

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