Ghana recently extended its zero value-added tax (VAT) policy for domestic textile manufacturers. Finance minister Ken Ofori-Atta announced the decision while presenting the 2024 budget in parliament. This is the policy’s second extension in a row.
The Association of Ghana Industries (AGI) had earlier requested the government to further extend the policy as the first extension will end on December 31 this year.
AGI feels the decision will reduce smuggling of textiles from neighbouring countries and further help domestic manufacturers recover from a slump, according to a domestic newspaper report.
The policy was introduced in 2019 for three years to revive the domestic textile industry, which was facing hard times due to the influx of pirated and cheap products. As the pandemic-induced slump hit the textile sector, the policy was extended for two years.