Ghana Employers Association (GEA) are pushing for deferment of Value Added Tax (VAT) and Income Tax Payments for businesses in the country.

According to the Association, the current environment makes it difficult for most of its members to honour their payments when the time is due.

This was contained in a circular to members of the Ghana Employers Association in the country.

Details of the proposals

The Association believes this would also help cushion businesses hard-hit by the outbreak of the pandemic.

Also, income tax payments for up to the mid-year (or beyond as appropriate) be deferred or be allowed to be paid in instalments by businesses after prior agreement with the revenue authorities.

“All registered businesses in Ghana must be eligible for this relief,” it added.

An Emergency Loan and Fund

The Ghana Employers Association is also calling for the establishment of COVID 19 an Interruption Loan Scheme.

This is a temporary loan scheme intended for SME’s and distressed but potentially viable big businesses, to cushion them against the impact of the pandemic.

These loans must have government guarantees in order to give the lenders the needed comfort and assurance in financing the scheme.

Emergency Fund to deal with financial loses and fallout ..

The Association is also asking government to create an Emergency Fund to help address the financial challenges or fallout from the outbreak of the pandemic.

Businesses could access the fund for the payment of workers salaries, procurement of raw materials, working capital, among others during these critical times of COVID-19 if they are to retain employees on their respective payrolls.

Potential Impact on Employment

They also want some negotiations with the Ghana Trade Union Congress to deal with the position job loses as a result of the this development.

“The proposed  dialogue would look at  the financial implications of the lay-offs since the disruption of the employment contracts may not have been contemplated by the parties,” it added.

It noted that  good number of businesses, especially those sectors who are hardest hit by the pandemic are likely to review the employment relationships with their workers including some potential lay-offs.

Potential Business Closures

In the unlikely event of total Business closures in the country, there would be the need for Government to support affected organisations by support in the payment of workers salaries for the period of the closure of the businesses.

Also it says in the event of a lay-off of workers as a consequence of the pandemic government would support payment of redundancy packages to affected workers.

GEA shall continue to update employers on developments and accordingly urges members to contact the Secretariat for prompt support or intervention on challenges or issues arising out of the COVID-19 crises period.

Continued Operations of Existing Commercial Bank Facilities

A good number of businesses (if not all) operate on the strength of Commercial Bank Facilities.

The drastic dislocation in the finances of these businesses – small, medium and large – occasioned by the negative impact of COVID-19 cannot be overemphasised.

GEA strongly recommends that Government works with the Commercial Banks to assure that these businesses are allowed by the Banks to continue to access the facilities under more flexible conditions so that the Businesses do not collapse for want of working capital, among others.