Chinese coy granted $47m tax exemption aiding NDC campaign
By Daniel Nonor
Huawei Technology Company Limited, a Chinese company at the center of a controversial USD $43 million tax exemption by the government of Ghana over an e-Ghana project, is in the news again for aiding the political activities of the ruling National Democratic Congress (NDC), contrary to the country’s political parties act.
Documents and commercial invoices available to The Chronicle indicate that Huawei Technologies (GH) has been printing campaign paraphernalia (T-shirts, cups, key holders, etc) worth millions of US dollars for the ruling party.
A pressure group, Alliance for Accountable Governance (AFAG) which made this public at a press conference held in Accra yesterday, made available some documents to back allegations of the Chinese company’s complicity with the ruling NDC to violate the country’s laws.
Commercial invoice receipts sighted by The Chronicle indicate that on May 5, 2012, Huawei Technologies (GH) took delivery from Richfile industrial (SHENZEN) CO. LIMITED, 60,000 pieces of NDC paraphernalia, worth US $42,040.00.
Another, dated 30-3-2012, with items received on 26 July, 2012, just two days after the demise of President John Mills, indicated a delivery of 50,000 NDC branded T-shirts by Huawei Technologies from CHINABAND INTERNATIONAL LTD, at the cost of US$62,698.41.
WHAT THE POLITICAL PARTIES ACT SAYS
The Political Parties Act 574, governing the formation and conduct of political party activities in the country, is explicit on who and which entities qualify under the law to made donations, either in kind or cash, and the sanctions there is to the breach of provisions in the Act.
Section 23, which talks about contribution by citizens to political parties in the country, states:
(1) Only a citizen may contribute in cash or in kind to the funds of a political party.
(2) A firm, partnership, or enterprise owned by a citizen or a company registered under the laws of the Republic at least seventy-five percent of whose capital is owned by a citizen is for the purposes of this Act a citizen.
Section 24 of the Act, however, explicitly states that:
A non-citizen shall not directly or indirectly make a contribution or donation or loan, whether in cash or in kind to the funds held by or for the benefit of a political party, and no political party or person acting for or on behalf of a political party, shall demand or accept a contribution donation or loan from a non-citizen.
Section 25 of the Act is where most Ghanaians, and AFAG alike, are looking to for action, should the parties involved be found culpable.
Provisions in section 25(1) (2) of the Act states: Where any person contravenes section 23 or 24, in addition to any penalty that may be imposed under this Act, any amount, whether in cash or in kind, paid in contravention of the section, shall be forfeited to the State, and the amount shall be recovered from the political party as debt owed to the State.
The political party or person in whose custody the amount is for the time being held shall pay it to the State.
(2) A non-citizen found guilty of contravention of section 24 shall be deemed to be a prohibited immigrant, and liable to deportation under the Aliens Act, 1963 (Act 160).
AFAG also questioned the credibility of the Chinese company, which, it said, had some questionable transactions in other countries.
The group, however, expressed shock that “this company has been well received by the NDC government, without due regard to due diligence.”
In view of this, AFAG is calling on the Ghana Police Service and the Attorney General’s Department to investigate the matter and apply sanctions as the law provides.
The group further charged the Electoral Commission to publish the annual report of the NDC, to ascertain whether these donations have been reported.
REWARD FOR FUNDING THE NDC?
Just a few weeks ago, the Minority in Parliament sought to find the secret behind a juicy US$43 million tax exemption to Huawei Technologies on a contract to execute the country’s US$127.5 million E-Government Platform Project.
The project is being undertaken by the government of Ghana, as part of efforts to build a sustainable nationwide ICT infrastructure to bridge the gaping technology divide in the country.
The Government of Ghana, through parliamentary approval, offered juicy incentives to Huawei, in the form of tax waivers, which include an income tax of US$4,987,295.00; an output VAT of US$7,344,322.36; Input VAT of US$4,351,945.14, and US$26,358,254.00 customs duties.
Other incentives included a waiver of custom duties, VAT, EDIF, ECOWAS Levies, Destination Inspection Fees, withholding taxes, Corporate Income taxes and other charges, amounting to US$43,041,816.50, on goods and services relating to the E-Government Platform Project by Huawei.
Although the minority in the House raised serious objections to the tax laxities given the Chinese firm, the Majority had their way in approving the deal, by virtue of their numbers.
Questions are therefore, being raised as to whether these tax exemptions given to Huawei could be a possible reciprocal reward for their benevolence towards the party in power.
Meanwhile, Richard Quashigah, Propaganda Secretary of the ruling National Democratic Congress, in response to the allegations made by AFAG, said he cannot say for a fact if the party had any such business dealings with Huawei, in connection with the paraphernalia, but dismissed the claims outright .
“I can’t say for a fact, but from my perspective, it is not true…I don’t know of any political connection with Huawei,” he emphasised.
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