The National Association of Sachet and Packaged Water Producers (NASPAWAP) has joined the chorus of voices calling on the government to suspend the imposition of a 5% Excise tax on finished plastics. The association believes that this tax will have a devastating impact on the final consumer, who is already struggling with the high cost of living.
A statement issued by NASPAWAP on July 8, 2024, said water is a essential commodity that should be exempt from taxes, as is the case in many countries. In Ghana, 72% of urban populations rely on sachet water, and the percentage is likely higher in non-urban areas due to the pollution of water bodies caused by galamsey operations.
The association argues that the Excise tax will lead to an increase in the retail prices of sachet and bottled water, which has already seen two price adjustments since January 2024 due to the depreciation of the cedi against the US dollar.
The statement which was signed by Magnus Nunoo, NASPAWAP President, suggests that instead of imposing a 5% Excise tax on finished plastics, the government should reinforce the existing 10% environmental Excise tax on selected plastics at the ports of entry. They propose reducing the tax rate to 1% and applying it to all imported plastic granules without exceptions. Semi-finished plastics imported into the country could be taxed at 10% of the CIF value.
The association believes that this approach will generate more revenue for plastic management than the additional 5% Excise tax on finished plastics. They also point out that the private sector has borne the sole responsibility of managing plastics in the country, from collection to recycling, without any government subsidy.
NASPAWAP is urging the government to suspend the Excise tax on finished plastics indefinitely and engage with stakeholders to find a more sustainable solution.
Ruth Abla ADJORLOLO
