The Ghana Real Estate Developers Association (GREDA) has welcomed government’s decision to scrap the 5% VAT on cost of real estate.
Presenting the budget in parliament yesterday, Finance Minister, Ken Ofori-Atta announced that government has abolished a number of taxes including, the 1% Special Import Levy, 17.5% VAT/NHIL on financial services, 17.5% VAT/NHIL on selected imported medicines that are not produced locally, 17.5% VAT/NHIL on domestic airline tickets, 5% VAT on real estate cost, and Duty on imported spare parts among others.
GREDA had for some time now pushed for the tax to be removed as they described it as a nuisance levy.
Expressing the association’s stand on the issue, the Executive Secretary of GREDA Samuel Amegayibor told Citi Business News the move will create more opportunities for the housing sector.
“It’s good news. That has been what we wanted in the past. Our argument has been that, if you look at the housing fee, I don’t think introducing additional taxes was the best to go,” he said adding that it will positively impact on Ghana’s housing industry in the long term.
Touching on the need for government to create a conducive environment for the housing sector, Mr. Amegayibor maintained that the industry can help provide affordable housing to Ghanaians if the composition of its cost of production is reduced.
“The housing deficit rather calls for certain incentives to drive the private sector to participate in providing housing. And so we saw the position of the VAT as very bad for the industry.” she said.
“Luckily for us, before the NPP came into power they had already mentioned it because they were equally following our argument. Today we have heard it in the budget so we are happy about It.” he added.
By: Jessica Ayorkor Aryee/citibusinessnews.com/Ghana