Honouring tax obligations is a key factor to business sustainablity
The already cumbersome nature of starting a business in Ghana comes with its own risks, obligations and downsides.
From getting your business registered, to being granted a business permit to operate and then moving on to sustain that business, the story is no different from that of locals as compared to foreigners that seek to set up businesses in Ghana.
According
Read full article.to a Nigerian business owner, their quest to set up a business in Ghana, dating as far back to 2009, was plagued with a familiar ‘taxation problem’ that many businesses in Ghana already face.
In a series of tweets sighted by GhanaWeb, Osaretin Victor Asemota narrated that while believing their business would thrive in Ghana as compared to Nigeria, the number of tax obligations they had to honour seemed outrageous and affected their business operations.
"I came to Ghana in 2009 and we set up a business here to serve Africa from Ghana because it was easier to do so from here than in Nigeria. We hustled and struggled to do so and were taxed in a manner I had never experienced. The taxman had my phone number. This is not a joke."
"They will call me to ask why we hadn't done XY and Z yet? They had all our inflow information and I could only think that they were in cahoots with the bank. The only other place I had seen with more aggressive taxation was South Africa. We also set up a subsidiary there as well," Asemota recounted.
Upon witnessing this, the Nigerian business owner called on other colleagues who were running businesses in Ghana to ascertain whether they faced the same fate as he did, but to his surprise, their response was no.
"I asked friends who ran local companies in Ghana if they undergo the same scrutiny? They said no, they submitted returns to SSNIT and others monthly. Apparently, they knew what to do and I didn't. We decided to hire local finance people and that was another disaster. It was a pain," he stressed.
After experiencing the frustration, Victor Asemota said his team resorted to hiring locally in hopes of getting different results - a decision which he says was his biggest nightmare that backfired immensely.
"Hiring locally has been my biggest nightmare since we moved to Ghana. Honestly, I still don't know how most businesses manage to run here. Almost everyone working somewhere has another side gig and they don't take both seriously. A friend said it was a socialist government aftereffect."
While navigating through this, Asemota was still faced with paying huge taxes and paying salaries of employees but after a short while, he indicated it was not a viable solution and had to result in layoffs.
"Your finance person will want you to pay more taxes and not less, while also making sure they get their salary while moonlighting elsewhere. It was not a viable solution and we fired them and then outsourced it. Outsourcing almost everything seemed to be the magic bullet but it didn't really change the outcomes much. We have a productivity crisis around Africa,” he lamented.
I came to Ghana in 2009 and we set up a business here to serve Africa from Ghana because it was easier to do so from here than in Nigeria. We hustled and struggled to do so and were taxed in a manner I had never experienced. The taxman had my phone number. This is not a joke.
