The Association of Ghana Industries (AGI) has called on the government to reverse the 20% excise tax on locally produced sweetened beverages and fruit juices.

According to the AGI, removing this tax will support the government’s 24-hour economy programme and enable local producers to expand their operations and create more jobs.

The AGI believes that tax rationalisation under the 24-hour economy initiative will allow fruit juice producers to return to their original production capacity and beyond.

They argued that eliminating the excise tax would help local factories in the sector to provide more employment opportunities.

The tax, which was imposed in 2023 under the Amendment Act 2023 (Act 1093), has caused significant challenges for sweetened and fruit juice producers. Since its implementation, the AGI reports that sales for some companies have dropped by more than 50%, and production utilisation has decreased from around 85% to 38%.

In a letter addressed to the new Minister of Finance, Dr Cassiel Ato Forson, the AGI highlighted that the excise tax has led to mass layoffs and allowed imported products to dominate the local market.

Local producers such as Ekumfi Fruits and Juices Limited, Healthlife Beverages Limited, Kasapreko Limited, and Aquafresh Limited are also facing challenges in competing with imports, high product costs, reduced production capacity, and multiple taxes.

AGI warns that if these issues are not addressed, the sector could collapse, further undermining the goals of the 24-hour economy.

In a separate letter, the Ghana Federation of Labour also urged the government to reconsider the excise tax, stating that it is severely damaging the local beverages production industry.