GRA seals McDan salt firm's offices over unpaid taxes

Ghana's tax authority has sealed part of the offices of Electrochem Ghana Limited, a subsidiary of the McDan Group, over an outstanding tax bill of 6.8 million cedis ($650,000; £480,000), giving the company seven days to pay or face tougher enforcement measures.

Officials from the Ghana Revenue Authority (GRA) on Wednesday locked the administration block of the company's salt mining operations at Ada after what the agency described as repeated unsuccessful attempts to recover the debt.

The move forms part of a wider campaign by the tax authority to increase revenue collection as the government seeks to strengthen public finances.

Speaking after the enforcement exercise, the GRA's Accra Area Enforcement Manager, Joseph Annan, said the authority would escalate its action if the company failed to settle the outstanding amount within the deadline.

"If they fail to pay after the seven days, then our next visit here will not be friendly at all," he said.

Mr Annan said the original tax liability, including accumulated interest, had reached about 8.8 million cedis, but the company handed the authority a cheque for 200,000 cedis during Wednesday's operation.

Although he described the payment as "woefully inadequate", he said it had been accepted while discussions continued.

The GRA said it chose not to shut down the company's entire operations immediately to allow it to continue generating income to pay the remaining debt.

"We decided to seal the administration block and give them the opportunity to work in order to raise the remaining balance within the next seven days," Mr Annan said.

He added that while the authority recognised Electrochem as an indigenous Ghanaian business, it also had a responsibility to ensure taxes owed to the state were collected.

"The state needs the funds to carry out many projects," he said.

According to the GRA, the outstanding tax liability dates back to 2021, despite several demand notices and engagements with the company over the years.

Officials of Electrochem appealed to the tax authority to exercise restraint, assuring the enforcement team that the company was mobilising resources to clear the debt.

The latest action is part of intensified enforcement by the Ghana Revenue Authority against businesses with outstanding tax obligations, as it seeks to meet its revenue targets for the year.

Electrochem Ghana Limited is one of Ghana's largest salt producers and forms part of the McDan Group of Companies, a conglomerate with interests in logistics, aviation, real estate and mining.