The Registrar of the Garden City University College at Kenyasi in the Kwabre East District of the Ashanti Region, Dr. Kweku Owusu Kwarteng, has commended government for the decision to grant tax reliefs to privately-managed tertiary institutions.
“It is something that is great for all private universities, great in the sense that it will give us resources to infuse into our programmes and capital expenditure, ” he said.
The government announced that privately-owned universities will be granted the reliefs enabling them to thrive and admit more students.
Making the announcement in the 2018 budget, read in Parliament on Wednesday, November 15, Finance Minister, Ken Ofori-Atta, revealed that the private institutions will no longer be required to pay corporate income tax.
Speaking to Citi News, Dr. Kwarteng said this move by government will go a long way to help private universities and benefit the country at large, describing it as a step in the right direction.
“At the end of the day, with the social entrepreneurship that we are doing in the private universities , educating Ghanaians rebounds to the benefit of the larger Ghanaian society. So if the government deems it fit not to take the 25% back, let us retain it and use it in what we are doing to complement public sector tertiary education, it’s a good first step,” he added.
According to the Finance Minister, investing in the country’s private educational institutions would significantly boost the reputation of the sector, potentially making the country an attractive destination for investors.
“The education sector represents a high growth potential with multiplier effects on the economy as confirmed by a recent “Country Private Sector Diagnostic” study by the World Bank Group. This is borne out by the rapid growth in privately-owned and managed universities as well as in the inward flow of students from the West Africa sub-region,” he said.
But the Director of the Centre for Budget Advocacy Ghana, Vitus Azeem, believes the Akufo-Addo administration’s aim to make Ghana self-sufficient will be better served by increasing corporate tax significantly.
Mr. Azeem urged the government to spread its tax net instead of exempting more people from paying income tax.
“One example I have been very much against is private universities. Can you imagine somebody saying that corporate tax on private universities is a nuisance tax because they are contributing to the development of the country?”
“The driver who drives a government car takes a salary of less than GHc 100 and is taxed. A nurse and doctor who save lives are taxed. They are contributing to the development of a country. So if a private university is making profits, why should it be exempted them from tax,” Mr. Azeem argued.