Rural banks are appealing to government to reduce high corporate taxes on profits of financial institutions which they say is crippling their operations.
The board Chair of the Nwabiagya rural bank, Nana Owusu Sarfo Awonah II made the call speaking at the 23rd Annual General Meeting (AGM) of the bank which was held at Barekesse in the Ashanti region.
Nana Awonah II expressed worry that the increase of corporate taxes from 8% to 25% which took effect last year has adversely affected the bottom line of rural banks.
He warned that the ability of rural banks to contribute to the economic development of rural Ghana will be curtailed if the prohibitive taxes are not reduced.
“It is upon this premise that all rural banks are appealing to the honourable Minister of Finance to take a second look at the prohibitive taxes initiated by the immediate past government if he really wants the rural bank industry to thrive and continue contributing to the rural development agenda as they have been doing since the inception of the rural banking industry in the late 70s,” Nana Awonah cautioned.
He also called on Members of Parliament (MPs) serving on boards of rural banks and have direct interests with these banks to champion the course of the reduction in corporate taxes on the floor of Parliament to save the rural banks from collapse.
Speaking to Ultimate News’ Ivan Heathcote Fumador on the sidelines of the AGM, the President of the Ashanti regional chapter of the Association of Rural Banks Mr. Patrick Owusu pointed out that rural banks will be compelled to cut their corporate social investments if the taxes are not readily reduced to ease pressures on rural banks.
He insisted, “we are good corporate citizens but the quantum of increase from 8% to 25% is very high so if government can revisit and take us to say 10% or maximum 15%, we will manage it. But 25% will affect what we know to do best in Ghana which is Corporate Social Responsibility (CSR) in the rural areas.”
Meanwhile, the Nwabiagya Rural Bank increased its shared capital and net worth from GHC2,287,759 in December 2015 to GHC2,355,844 as at the end of December 2016.
The number of shares of the Nwabiagya Rural Bank also increased from 17,176,838 in the 2015 financial year to 17,313,007 by the end of the 2016 financial year.
The Rural Bank also resolved to pay its shareholders dividends calculated at GHC0.06 compared to last year’s GHC0.045 paid to shareholders.
By: Ghana/Ultimatefmonline.com/106.9FM/Ivan Heathcote-Fumador