Mining contributes 27.6% to government revenue in Ghana

The mining sector in Ghana contributes 27.6% to the government’s total revenue, the Minister of Lands and Natural Resources has said.

Speaking at the opening ceremony of a two-day West Africa workshop on Improving Mining Taxation in Accra Thursday September 13, 2012, Mr. Mike Hammah indicated that the workshop marks the beginning of a series of engagements to improve the draft mining tax collection administration framework developed by the World Bank.

He said mining has made significant contributions to Ghana’s economy, as it contributed 27.6 percent to total government revenue and 42 percent of total merchandise exports in 2011.

“Indirectly, in addition to significant amounts being spent on corporate social responsibility projects by the industry, it is estimated that for each worker the industry employs, there is a multiplier effect of about five,” he said.

He therefore, argued that it is important for the tax regime in Ghana to be improved to maximize the impact of mining in the lives of the populace.

“If that is done, it will significantly erase the negative perception of mining as an economically and environmentally negative venture in the country,” he said.

Mr. Hammah also said besides improving the direct taxation regime, the real benefits lie in the area of sector integration.

“Integrating the mining sector fully with the rest of the economy through backward, forward and lateral linkages is the key to ensuring that the host nation benefits more from mining,” he said.

He indicated that to achieve this, conscious planning by government will ensure that mining is used as a growth pole to catalyse investment in other sectors of the economy.

According to him, collaboration between the revenue agencies and the mining-related institutions to implement appropriate monitoring, evaluation, reporting and audit systems will ensure that government receives the appropriate revenues from the exploitation of the country’s minerals.

Mining has been going on in Ghana for over 100 years.

Gold, diamond, bauxite and manganese are mined in the country, recently, large deposits of iron ore has also been discovered.

The two-day workshop is organised by the World Bank.

By Emmanuel K. Dogbevi