Ghanaian filmmaker Peter Sedufia has raised concerns about the heavy tax burdens placed on filmmakers in the country.
In a post sighted by Zionfelix.net, Sedufia addressed the Minister of Tourism, Culture, and Creative Arts, Hon. Abla Dzifa Gomashie, lamenting that the current tax policies on the creative economy are a major deterrent to the growth of the sector.
Using the film industry as an example, Sedufia highlighted that the government takes 30% in taxes from total sales revenue. The remaining 70% is then split equally between the filmmaker and cinema owners at 35% each.
“I want to use this morning to publicly congratulate you on your appointment as the substantive minister for a sector I proudly belong to—the Ministry of Tourism, Culture, and Creative Arts. This sector arguably provides more employment to individuals outside of government institutions. However, I won’t waste time beating around the bush.
“The taxes imposed on the creative economy are a huge disincentive. They make it extremely difficult to sustain any creative endeavor in Ghana. As someone with experience in the industry, I’m sure you are not a stranger to this. While I can’t speak much about the music side, I’ll focus on the film industry, where I belong.
“Currently, for every 100% revenue we generate from the limited cinema screenings in Ghana, the government takes 30% in taxes. The remaining 70% is then split, with 35% going to cinema owners and 35% to the filmmaker. This is just for the first week of screenings; the filmmaker’s share reduces even further as the weeks go by.
“To put this into perspective, if a Ghanaian filmmaker earns GHC 100,000 at the cinema, the government takes GHC 30,000, the cinema owner takes GHC 35,000, and the filmmaker is left with GHC 35,000,” Sedufia explained.
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He further elaborated, “For a filmmaker to break even at the box office, the film must generate at least three times its production cost. On average, a decent Ghanaian film costs around GHC 400,000 to produce, excluding marketing expenses. However, Ghana only has one major cinema chain, Silverbird Cinemas, with two locations—Accra Mall and West Hills Mall. Together, they offer about 2,400 seats.
“Even if a filmmaker manages to fill all the seats for two shows on the opening day (which rarely happens; only two Ghanaian filmmakers have ever achieved this), that’s just 4,800 admissions. Let’s assume the film attracts 5,000 admissions throughout its cinema run at GHC 100 per ticket. That would generate GHC 500,000 in gross revenue.
“From this, the government would take GHC 150,000 in taxes. Meanwhile, as the weeks progress, the cinema owner’s share increases, potentially leaving them with GHC 200,000 and the filmmaker with only GHC 150,000. The situation would be much different if there were more cinemas across the country to support theatrical releases,” he noted.
Sedufia compared this to Nigeria, saying, “In Nigeria, for every GHC 100,000 equivalent I earn, I pay less than 15% in taxes—less than GHC 15,000. Additionally, Nigeria has over 80 cinema locations to increase viewership, compared to Ghana’s approximately five.
“While Nigeria’s population is about seven times larger than Ghana’s, they have over 16 times the number of cinemas. Shouldn’t we, at the very least, strive to match up or catch up based on population ratios?”
He concluded his statement with an appeal to the minister: “I don’t know what you’ll do with this information, but I felt compelled to bring it to your attention. I wish you all the best in your new role. You are one of us—our own. We’ll continue to pray for and support you to succeed so that we too can succeed.”
