‘You’ll Kill Local Businesses’: Afenyo-Markin Fights 7% Withholding Tax Increase in Parliament
Accra, Ghana — Minority Leader Alexander Afenyo-Markin has cautioned Parliament against approving a proposed increase in Ghana’s withholding tax rate from 3% to 7%, warning that the measure would cripple small and medium-scale enterprises (SMEs) already struggling with limited access to capital.
Speaking during deliberations on the 2026 tax amendment bill on Tuesday, November 25, the Effutu MP argued that while larger corporations could absorb the rate hike, the same could not be said for local entrepreneurs and family-owned businesses that rely heavily on informal credit systems to stay afloat.
“Mr. Speaker, many businesses, especially our small and medium enterprises that are Ghanaian-owned, have serious issues with capital,” he said. “They take loans from the informal sector to finance their businesses. Currently, withholding tax is 3%. If I’m getting payment and you are withholding as much as 7%, that is punitive. You are holding my capital.”
The legislator urged the House to maintain the current 3% rate, describing the proposed hike as “anti-business” and counterproductive to the government’s stated goal of promoting entrepreneurship and job creation.
“How many people make even 10% profit on sales? If now we want to increase it to 7%, no, we will be killing local business because their profit margins are very low,” he warned. “It is only the big companies that can meet the conditions to have exemption.”
Afenyo-Markin reminded Parliament that withholding tax rates had been reduced in the early 2000s under the Kufuor administration, following complaints from the private sector about liquidity challenges. “Let’s not rush and just increase to 7% because it used to be 10% and it got reduced way back in Kufuor’s time,” he said. “If we take it to 7% now, we will be creating more problems for local enterprises.”
He further proposed a formal amendment to Clause 561A of the bill, calling for the deletion of “7%” and the insertion of “3%” to preserve the existing rate. “Those of you who are entrepreneurs in this chamber know the real challenges you face. The small and medium-scale enterprises, the beginners, need their revenue to reinvest. Let’s maintain the 3%,” he appealed.
Afenyo-Markin also noted that ongoing digitalization and tax efficiency reforms would improve compliance without the need for punitive tax hikes.
“The new system of efficiency being introduced will encourage more people to pay. But if you take it to 7%, only multinational companies will continue to benefit because they already have capital. You and I, our small businesses will continue to suffer.”
The debate forms part of ongoing fiscal reforms under the 2026 Budget and Economic Policy Statement, which has sparked nationwide discussion about the government’s approach to balancing revenue generation with private sector growth.
Read Also
Ghana’s informal economy is larger than many think. New data shows how mobile and open-space businesses—dominated by women and youth—are powering livelihoods across the country.
Ghana revises cocoa producer price to GHS41,392 per tonne after global prices fall from US$7,200 to US$4,100, citing liquidity and sustainability concerns.
Ghana’s economic activity expanded by 4.2% in November 2025, driven largely by strong growth in the services sector, according to the latest MIEG report from the Ghana Statistical Service.
Bank of Ghana Governor Dr. Johnson Pandit Asiama launches the Bank Listing Project, citing GH¢100bn pension assets and calling for stronger transparency and market discipline.
Upper West, North East and Volta record highest food insecurity levels as Ghana’s national rate falls to 38.1%, with education emerging as a key protective factor.
COCOBOD CEO Randy Abbey says he inherited GH¢3.8bn negative equity, GH¢26bn road exposure and $48m procurement obligations at the cocoa regulator.
Ghana’s Ministry of Finance has officially relocated its offices to Kanda in Accra, with full operations commencing on February 9, 2026. Here’s what you need to know.
Ghana’s DVLA has released a full list of approved vehicle service rates, affecting registration, inspections, and conversions nationwide. Here’s what drivers need to know.
Finance Minister Cassiel Ato Forson says Ghana’s Gold Coast Refinery is now refining one ton of gold weekly, boosting local value addition and jobs.
Ghana’s inflation rate fell to 3.8% in January 2026, its lowest in four years, as food and non-food prices eased nationwide, according to GSS data.
Bank of Ghana Governor Dr. Johnson Asiama says inflation fell to 5.4% and reserves rose to $13.8bn as policymakers consider a cautious path for 2026.
The Institute for Energy Security says Ghana’s fuel price floor protects fair competition and long-term stability, responding to calls for lower petrol prices.
Government says the $1.4bn energy-sector payment has stabilized power supply, restored liquidity, and prevented a return of widespread outages.
New GSS data shows a 3.8% jump in economic activity driven mainly by services and manufacturing. Agriculture also ticked up slightly. Full report breaks down where the growth is coming from and what comes next.
Ghana’s labour force expanded in 2025 with over 330,000 new jobs, but youth unemployment remains high at over 32 percent, according to new data from the Ghana Statistical Service.
The Ghanaian cedi sold at ¢11.5058 to the US dollar on December 18, 2025, according to the Bank of Ghana’s latest interbank exchange rates.
Ghana’s economy expanded by 6.1% in the first nine months of 2025, with agriculture, ICT, and trade powering growth. Government Statistician Dr. Alhassan Iddrisu says the data shows “slightly stronger momentum” than 2024.
Germany has pledged an extra €3 million to Ghana’s Sustainable Energy for Climate Project, bringing total support to €10 million, as both nations deepen cooperation on renewable energy, efficiency, and climate resilience.
Ghana’s inflation rate dropped for the 11th consecutive month to 6.3% in November 2025, the lowest since 2021. The Ghana Statistical Service attributes the trend to price stability in food, non-food, and locally produced items.
Ghana’s Public Utilities Regulatory Commission (PURC) has announced new tariffs effective January 1, 2026 — electricity to increase by 9.86% and water by 15.92% under the 2026–2030 Multi-Year Tariff Review. The adjustment reflects inflation, exchange rate, and gas cost projections.
The Bank of Ghana has reduced its policy rate to 23%, citing strong economic recovery, stable inflation, and improved reserves. Governor Johnson Asiama says Ghana is “shifting from recovery to expansion” as the BoG balances disinflation with growth.