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Fri, Dec

TAX HOLIDAYS FOR YOUNG ENTREPRENEURS

Business & Economy

The Minister of Finance, Ken Ofori-Atta, has revealed plans by the Akufo-Addo-led NPP government for young entrepreneurs in the country to receive tax holidays in 2018, as part of efforts at encouraging young business owners.

The Minister of Finance, Ken Ofori-Atta, has revealed plans by the Akufo-Addo-led NPP government for young entrepreneurs in the country to receive tax holidays in 2018, as part of efforts at encouraging young business owners.

 

Mr Ofori-Atta made this announcement in Parliament on Wednesday, when he presented government’s budget and policy statement for 2018.

During the presentation, he stated that the tax holidays would be granted to the recipients based on the number of their employees, adding that the process would be through the National Entrepreneurship and Innovation Plan.

“As a further commitment to creating a supportive ecosystem for young Ghanaian entrepreneurs of age 35 years and below, who start their own businesses, government will through the National Entrepreneurship and Innovation Plan (NEIP), grant tax holidays based on the number of persons employed by a start-up or early-stage business,” he said.

He further revealed that the recipients would not only “be allowed to carry forward losses for five years,” but also “a preferential tax rate of between 3 to 5 years will be granted after the tax holiday.”

It would be recalled that in July, this year, President Nana Addo Dankwa Akufo-Addo set up a 100 million dollar package to fund NEIP that is aimed at supporting young entrepreneurs to grow their business.

At the launch of that initiative, the President re-echoed his intensions to address the issue of unemployment in the country.

Mr Ofori-Atta further announced that the Akufo-Addo-led government would abolish income tax for individuals whose income is equal to the minimum wage.

According to the Finance Minister, this is part of the government’s effort to safeguard the interest of low-income earners in the country.

“To protect low-income earners and ensure fairness in our income tax administration, government will review the current income tax thresholds by pegging the tax-free threshold to the current minimum wage. In effect, government will abolish income tax on the incomes of minimum wage,” Mr Ofori-Atta said.

Furthermore, he mentioned that government’s current restructuring on lotteries would continue whilst the “measures against illegal lottery business intensified.”

In order to ensure that people do not engage in illegal lottery business, the Finance Minister announced that certain percentage placed on the business would be abolished.

“To remove the incentives for people to engage in illegal lottery, the 7.5% income tax on the commission of lotto marketing companies will be abolished and the 5% withholding tax on lotto prizes removed,” he explained.

 

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