5% Excise Tax on Plastics Unthinkable- Water Producers

The National Association of Sachet and Packaged Water Producers (NASPAWAP) has called for the indefinite suspension of the 5% excise tax on finished plastics, calling the imposition by the government “unthinkable”.

In a statement on July 8, 2024, the Association joined other plastic dealers to kick against the tax as it cited a report by the Ghana Statistical Service (GSS) to draw attention to the impact it will have on the final consumer.

“According to a GSS report released in 2023, 72% of urban populations depend on sachet water. The percentage in the non-urban population could even be higher due to the extensive pollution of our water bodies due to galamsey operations.

It highlighted that water is life and therefore exempted from all forms of taxes in most parts of the world.

“It is therefore unthinkable that an Excise tax of 5% is been imposed on finished plastic which could inevitably affect the retail prices of sachet and bottled water.”

It added, “We believe the motive for the 5% extra excise tax would be to raking in funds to tackle the menace plastics is posing to the environment. There is an existing 10% environmental Excise tax on selected plastic at the ports of entry.   We were part of the decision to tax plastic granules at the entry ports.  This method broadens the tax base since all plastic granules are imported.  However at the implementation stage only a selected few were captured.”

The Association further suggested that the government rather reinforce the environmental Excise tax at the entry points by reducing the tax rate to 1% and make it applicable to all imported plastic granules without any exceptions.

However, Semi finished plastics imported into the country be taxed 10% of the value to rake in more funds for plastic management than the additional 5% Excise tax imposition on finished plastics, it added.

The Ghana Plastic Manufacturers Association, the National Association of Sachet and Packaged Water Producers and the Plastic Sellers Association of Ghana last week served notice for a protest against the tax; however, they have called it off.