Parliament Shoots Down Double Tax Agreement

Parliament has shot down a Double Tax Agreement with the Kingdom of Morocco, when the Finance Committee presented its report to the House on Monday.

While the Chairman of the Finance Committee of the House, Dr. Mark Assibey-Yeboah, called on the House to ratify and approve the Report, the Minority asked the House to “send the agreement back to sender”.

Seconding the Motion for adoption, the Member of Parliament for Afram Plains South, Eric Osei-Owusu indicated that, the purpose of the agreement is to avoid double taxation on the same income in Ghana and in Morocco.

He said most tax regimes discourage international trade and that it is important to vary the status quo to encourage increased cooperation and trade.

The Minority, however, rejected the stance of the committee on the basis that it would not inure to the benefit of Ghana.

Samuel George, Member for Ningo Pampram, asked the committee to produce just one Ghanaian company in Morocco that is likely to benefit from the agreement.

The Member for Old Tafo and the Minister for Monitoring and Evaluation, Anthony Akoto Osei, interjected on a point of order and brought the House’s attention to the fact that the agreement was merely on double tax avoidance which was mutually beneficial.

Richard Acheampong, Member of Parliament for Bia East, asserted that the House should rather consider what Ghana is likely to benefit from the agreement, instead of always considering that of other countries.

He added that as it stands, countries would take undue advantage over Ghana, and wondered why Ghana was sacrificing so much for Morocco when she did not stand to gain anything.

Inusah Fuseini, Member for Tamale Central and ranking Member for Constitutional, Legal and Constitutional Affairs, on his part, agreed with the school of thought that Parliament should shoot down the agreement. He said several such agreements had been reached with Ghana not benefiting.

Muntaka Mohammed Mubarak, Minority Chief Whip, used the principle of boxing to ask the House to reject the agreement. He said countries that enter such agreements should be on the same scale to mutually benefit.

The Majority leader indicated that even though the concerns of the Minority may be worth considering, it should allow the agreement to go through, so that the House would be guided later.

But the Minority Chief Whip raised the issue of quorum to demand that the agreement be rejected.

The agreement was subsequently rejected.

Double taxation is a taxation principle referring to income taxes paid twice on the same source of earned income. It can occur when income is taxed at both the corporate level and personal level. It also occurs in international trade when the same income is taxed in two different countries.

By: Frederick E. Aggrey