Mr Speaker, I beg tomove, that this Honourable House adoptsthe Report of the Finance Committee onthe request for waiver of applicable taxesand levies, including import duties, importVAT, EDAIF, ECOWAS levy, destinationinspection fees and other import charges,VAT and withholding tax liabilities, otherproject related imposts including stampduty payment on the loan facility andspecified local taxes amounting to the cediequivalent of seventy-five million, sevenhundred and twenty-six thousand, sixhundred and seventy-three United Statesdollars (US$75,726,673.00), on theprocurement of supplies and services inrespect of the 360 MW Combined-CyclePower Project at Kpone in the GreaterAccra Region by Messrs Sunon AsogliPower (GH) Limited—Phase II. Mr Speaker, in so doing, I present yourCommittee's Report,
Introduction The request for waiver of applicabletaxes and levies, including import duties,import VAT and NHIL, ECOWAS levy,EDAIF, inspection fees and other importcharges, VAT and withholding taxliabilities, other project related imposts
including stamp duty payment on the loanfacility and specified local taxes,amounting to the cedi equivalent ofseventy-five million, seven hundred andtwenty-six thousand, six hundred andseventy-three United States dollars(US$75,726,673.00), on the procurement ofsupplies and services, in respect of the360 MW Combined Cycle Power Projectat Kpone in the Greater Accra Region byMessrs Sunon Asogli Power (Ghana)Limited -- Phase II, was presented toParliament by the Hon Deputy Ministerof Finance Mr Cassiel Ato Baah Forsonon behalf of the Hon Minister for Financeon Tuesday, 14th June, 2016, inaccordance with article 174 (2) of the 1992Constitution. The Rt. Hon Speaker referred therequest to the Finance Committee forconsideration and report in accordancewith Order 169 of the Standing Orders ofthe Parliament of Ghana.
Deliberations The Committee met and considered therequest with the assistance of the HonDeputy Minister for Finance, Mr CassielAto Baah Forson and officials from theMinistry of Finance and Ghana RevenueAuthority (GRA). The Committee expresses its gratitudeto the Hon Deputy Minister and theofficials for attending upon it.
Reference The Committee referred to thefollowing additional documents at itsdeliberations:
i. The 1992 Constitution of Ghana; ii. The Standing Orders of theParliament of Ghana;
of the phase I begun in 2011 andperformed reliably and efficiently insupplementing power generation capacityof the country. By 2014, Sunon Asogli had generatedabout 1307 GWH with 1253 GWH on-grid,which represented about 14 per cent ofthe total power supply in Ghana.Considering the good achievements ofthe Phase I, and the power supplyshortage in Ghana, Sunon Asogli resolvedto start the 360 MW Phase II project tohelp improve the power situation in thecountry. To this end, SunonAsogli entered intoa Power Purchase Agreement with theElectricity Company of Ghana (ECG) tosupply ECG with additional 360 MW ofpower. To facilitate the early completionof the project, and in line withGovernment's policy, the Ministry ofFinance is requesting for exemption ofappropriate taxes, duties, fees and othercharges relating to the execution of theproject.
Required waiver To ensure the smooth execution of theproject, the Ministry of Finance is seekingfor tax exemption up to the cedi equivalentof US$75,726,673.00 on suppliers,services, goods and equipment requiredfor the implementation of the project. Thecomposition of the taxes is as follows:
iii. Power Purchase Agreementbetween the Electricity Companyof Ghana (the Buyer) and SunonAsogli Power (Ghana) Limited(the seller) for the purchase ofelectrical energy. Background
One of the major policy objectives ofGovernment is to increase the installedcapacity of the country's electricitygeneration to 5,000 MW. This ambitioustarget, coupled with the recent energycrisis, requires an accelerated effort toincrease generation, reinforce and expandthe electricity transmission grid to ensurereliable and secured evacuation of power,to meet the increasing national demand. To this end, Government hassupported the efforts of the ElectricityCompany of Ghana (ECG) to enter intoAgreements with Independent PowerProducers to complement its efforts toachieve this objective. Sunon Asogli was formed by ShenzenEnergy, as an independent powerproducing company to supplement thepower generation in Ghana. The aim ofSunon Asogli is to build, own and operatea 560 MW power plant, which consists ofPhase 1 project (200MW) and Phase IIproject (360MW). Commercial operations i. Customs Duties, VAT and Import charges -- US$36,284,288.00 ii. Domestic VAT and Withholding Taxes -- US$37,075,025.00 iii. Stamp Duty on loan amount of (US$473,472,000) -- US$ 2,367,360.00 Total -- US$75,726,673.00