President of the National House of Chiefs, Togbe Afede XIV has criticised government’s decision to set up the Agyapa Minerals Royalties Limited in a tax haven.
According to him; “tax havens typically serve two purposes; helping you to avoid tax or ensuring secrecy. I don’t see why a national transaction should be shrouded in secrecy in the first place. And if we are trying to avoid or minimise tax, who are we denying tax payment?”
The traditional leader had earlier been sighted in a report to have endorsed the deal between government and the company.
But he has vehemently distanced himself from the reportage citing ill-will on the part of the perpetrators who framed the fake press release.
The new agreement is expected to enable the country to use a Special Purpose Vehicle (SPV), Agyapa Royalties Limited, to secure about $1 billion to finance infrastructural projects.
Deputy Finance Minister, Charles Adu Boahen at a press conference on August 27 indicated that incorporating Agyapa in Jersey makes the agreement tax-efficient.
The NDC and a cross-section of the public have among other concerns maintained that the mineral royalties lack transparency and have been undervalued in the agreement.
Speaking on September 3, the Chief of Asogli explained that the unavailability of some details regarding the Special Purpose Vehicle (SPV) makes it difficult to rally support behind it.
The President of the House explained that this development prevents the House of Chief from legitimising the deal.
“The corporation is incorporated in Ghana, the tax will accrue to Ghana which will be paid by this company which is owned supposedly by majority by Ghana so I do not see why we should be doing that in the first place,” he explained.
The funds from the deal, which are expected to be raised from the Ghana Stock Exchange (GSE) and the London Stock Exchange (LSE), will be a long-term capital, without a corresponding increase in Ghana’s total debt stock.