The Food and Beverage Association of Ghana has highlighted the adverse effects of over-taxation on the Ghanaian economy and called for major tax cuts in the 2024 fiscal year.

The Association's executive chairman, John Awuni, emphasised that while various governments have attempted to achieve stable economic growth in Ghana, none have managed to engineer a prolonged period of prosperity, leading to the blame game between successive administrations.

With Ghana recently visiting the International Monetary Fund (IMF) for the 17th time, the group expressed concerns about the imposition of harsher economic conditions and higher taxation on citizens as part of the solutions provided.

"If higher taxes were the key to our economic development, Ghana would have been really developed with citizens enjoying a lower cost of living among others," the statement read.

According to the umbrella body for food and beverage importers, Ghana's high cost of living has been exacerbated by frequent price changes and the imposition of numerous taxes and levies on goods and services.

The association believes that these high indirect taxes and levies, consumer and profit deductions are non-tax-deductible and have negatively impacted the private sector, which is considered the engine of sustainable economic growth.

Citing international studies, the group noted that tax cuts have been proven to have positive effects on economic growth.

The current government's pre-election stance, asserting that excessive taxation is not the path to prosperity and promising to move the country from taxation to production, was highlighted in the statement.

The Food and beverage importers advocated the removal of nuisance taxes and a significant reduction in taxes to stimulate economic growth.

The press release contended that reducing taxes and cancelling some of them in the 2024 fiscal year would help restore the economy's upward trajectory.

It argued that the current business sector is burdened with excessive taxes, levies, and duties, which are hindering growth.

Lowering taxes and eliminating some of them, the association believes, would increase the demand for goods and services in the private sector, leading to higher sales volumes, increased production, and more revenue for the government.

The statement presented a table showing the stark price differences for various goods with and without taxes, vividly demonstrating how consumers bear the brunt of these levies.

For example, a bag of rice was shown to be sold above the monthly salary of many low-income workers, slowing down sales turnover and profitability.

The association also highlighted the attractiveness of the Nigerian market due to higher sales volumes and drew a direct correlation between sales volumes, business growth, and tax revenue for government development projects.

The association strongly urged the Ghanaian government to ease the burden on the private sector by reducing corporate taxes, consumption taxes, and income tax and argued that overtaxing businesses hampers their capacity to invest in research and development for expansion, and the removal of these constraints is essential for sustained economic growth.

The press release concluded by warning about the rise in smuggling of goods due to the over-taxation of the formal sector and called for a collaborative effort to reduce taxes and foster a productive economic environment.