How a hotel was designated as 1D1F and granted $4 million tax exemption



In December 2022, Parliament granted a US$4 million tax waiver under the One District, One Factory (1D1F) programme to 4-Mac Limited, a company that is building a hotel at Airport Residential in Accra. 

The waiver is to cover import bills and other import-related taxes of the company. The company also received a five-year tax holiday.

The parliamentary approval followed a request from the Ministry of Finance dated July 25, 2022. The ministry initially sought approval for almost US$6.4 million in import tax relief for the construction of the four-star, Le Meridien hotel.  The 160-room hotel is expected to open its doors to customers in 2025.

An artistic impression of the Le Meridien Hotel project at the Airpot Residential area.

The Ministry of Finance wanted the relief granted in line with the tax exemption regime under the One District, One Factory Programme. This means the company would not pay a pesewa in taxes when it imports materials and equipment within the exemption granted. Additionally, the finance ministry asked that parliament allow the company not to pay VAT on items it procures locally for the project. Companies in this category also benefit from a five-year tax holiday.

But there are questions about the tax exemption for this hotel.

It was packaged under the government’s flagship industrialisation policy, ‘One District, One Factory’. Over the years, the government has portrayed the 1D1F programme as an ambitious policy to grow the manufacturing sector. It is the blueprint of the government for attracting investments into the sector in all 261 districts across the country.

As Parliament’s Standing orders (169) required, the finance ministry’s request was forwarded to the House’s Finance Committee, chaired by the Member of Parliament for Obuasi West, Kwaku Kwarteng.

The committee in its report to the House dated November 25, 2022, recommended that the request be approved, but it reduced the amount from US$6,389,428 to US$3,919,628.

“The Committee noted that included in the taxes to be waived was domestic Value Added Tax which is a domestic indirect tax. The Committee however considered that in the light of the new tax exemptions regime, domestic VAT should be removed from the basket of waivers,” the report stated.

Making a case for the exemption, the report said the tax waiver for 4-Mac Limited is consistent with the government’s overall policy to propel industrial growth under the 1D1F programme as it would contribute significantly to job creation in the tourism and hospitality sector.

Convinced by the report of the Finance Committee, the MPs approved the tax exemption for 4-Mac Limited. This was on December 7, 2022, five months after it was brought to the House.

According to Parliament’s records for that day, the Finance Committee’s justification for the approval of the request was that it was part of the “effort to speed up industrialisation and in line with the government’s policy of granting tax reliefs to new companies under the One District One Factory Programme, the government intends to grant tax reliefs on equipment and materials to be imported for the execution of the Le Meridien Hotel project.”

The Finance Committee indicated that its work is guided by documents including the 1992 Constitution, the Standing Orders of Parliament, and the Guidelines for the Approval of Tax Waiver under the 1D1F programme.

That guideline, developed by the Finance Committee, was approved by the House in June 2022, ostensibly to provide tighter control against the abuse of tax waivers within the framework of 1D1F.

Some experts The Fourth Estate interviewed believe the decision to grant nearly $4 million in tax waivers to 4-Mac Limited defeats the benefits of 1D1F the Finance Committee outlined in the guideline for 1D1F tax waivers.

“The Committee observed that when successfully executed, the Programme would ultimately lead to the establishment of at least one factory in each of the 260 districts in the country. It would help address the rural-urban drift and lead to the creation of jobs and an increase in Government revenue,” the guideline said of the potential benefits of the 1D1F programme.

A list of 1D1F companies The Fourth Estate obtained from the Ministry of Trade and Industry on December 15, 2022, did not even have 4-Mac Limited as part of the beneficiaries of the programme.

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Though the Ministry of Finance asked for over US $6m tax waiver for 4-Mac limited, Parliament’s Finance Committee granted US $4 m for the hotel project at Airport West near the National Children’s Library.

When The Fourth Estate visited the project site on August 15, 2023, no construction was taking place. The site had been cordoned off.

The security man at the post told The Fourth Estate that it had been on hold for a while but could not disclose exactly when it started nor when construction would resume.

However, people familiar with the building said construction work on the building started before the Akufo-Addo administration came to power in 2017. Its car park was a parcel of land owned by the Ghana Library Authority, which was sold to the developer, checks by The Fourth Estate revealed.

Finance ministry & Parliament’s response

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Ken Ofori Atta, Minister of Finance wrote to Parliament to ask for a tax waiver of US $6m for 4-Mac Limited.

The Fourth Estate on Wednesday, August 9, 2023, reached out to the Ministry of Finance requesting an interview on the matter with Dr John Kumah, a deputy minister, whom parliament consulted extensively on the development of the guideline on 1D1F tax waivers.

The ministry’s Head of Communication, Cecilia Akwetey, said “The request has been forwarded to the deputy minister’s office. They will reach out.”

They did not. The Fourth Estate followed up with calls to Dr Kumah on August 15, 2023, but got no response.

However, he responded to a text and WhatsApp messages saying “Please, kindly write formally to the minister so the specific schedule officer may assist with the appropriate response. I don’t handle that schedule, thanks.”

That letter was submitted to the Ministry of Finance on Wednesday, August 16, 2023. The ministry has not responded at the time of publishing this story.


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Kwaku Kwarteng is the Chairman of Parliament’s Finance Committee, which granted the over US $3m tax waiver to 4-mac limited under the 1D1F policy.

Similar attempts to reach the Chairman of the Finance Committee of Parliament, Kwaku Kwarteng, have not yielded fruits. Mr Kwarteng directed The Fourth Estate to the finance ministry for a response.

Over the years, the government had created the impression that the programme was for only the manufacturing sector. In February 2018, the Minister of Finance, Ken Ofori-Atta submitted a memorandum to Parliament that sought to request approval for incentives to support the implementation of the 1D1F programme.

In that document, the government mentioned manufacturing businesses in sectors such as agro-processing, light industries, pharmaceuticals, petrochemicals, garments and textiles as the target sectors for 1D1F tax incentives.

The 1D1F Programme 

The One District One Factory (1D1F) initiative was one of the campaign promises of the New Patriotic Party (NPP) ahead of the 2016 general elections.

The then-candidate Nana Akufo-Addo said he wanted to “change the nature of Ghana’s economy from one which is dependent on import and export of raw material to one which is focused on the manufacturing, value addition and export of processed goods” for which reason every district is expected to get at least on the factory.

To realise this, in July 2018, the Cabinet approved the request for companies under the 1D1F programme to be granted tax incentives by the government.

Parliament in the same year gave the green light to operationalise the tax exemptions to cushion the beneficiary companies’ production cost.

The tax incentives, according to Parliament, were intended to make industrial production competitive and attractive to the private sector as well as create an enabling environment for private companies to thrive.

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When The Fourth Estate visited the site close to the National Children’s Library, which is a few metres away from the Kawukudi intersection on August 15, 2023, no construction work was ongoing.

Hotels do not fall under the industralisation policy bracket – Bright Simons

Contrary to the government’s position, Bright Simons, the Honourary Vice-President of IMANI Africa believes that while hotels could not be considered strategic within the framework of industrialisation, in tourism, the focus should be on regions that are currently underserved or places close to tourist sites.

 “The national tourism development plan bemoans the overconcentration of high-end hotels in Accra, for instance. So, on top of hotels not falling within the industrialisation policy bracket, even within the tourism sector within which it falls, there is no basis for the government to lose tax revenue to incentivise the setting up of yet another high-end hotel in a location saturated with high-end hotels.

“Another high-end hotel within the Airport City enclave which already has an excess of high-end hotels will not contribute to the current priorities of Ghana’s tourism strategy.”

Going forward, he suggested that there should be a fixed budget for exemptions and sectoral quotas where companies seeking to benefit from a quota must compete for a portion of the funds through a transparent and merit-based process.

Hotels, he explained further, cannot be considered strategic within the framework of the industrialisation policy as they fall within another policy bracket – tourism. However, even within tourism, the focus must be on regions that are currently underserved or places close to tourist sites.

Abuse of the Tax Waivers 

According to the Finance Committee, the tax incentives are subjected to abuse.

After six years of its implementation, it has been observed that companies that received tax waivers are importing items that can be procured locally.

“The Committee holds the view that companies that benefit from tax waivers should be compelled to procure items locally if they are available as a way of promoting made-in-Ghana goods.”

It was the reason the guidelines for 1D1F tax incentives were developed.

However, in the case of 4-Mac Limited, the guideline seems to have little significance, as the construction of the luxurious hotel is granted tax relief that the government’s own legislation instructed should be aimed at benefiting manufacturing factories.

The government’s objective for the One District, One Factory policy was that it would, among other things:

  • Create massive employment, particularly for the youth in rural and peri-urban communities, and thereby improve income levels and standards of living, as well as reduce rural-urban migration,
  • Add value to the natural resources of each district and exploit the economic potential of each district based on its comparative advantage,
  • Ensure even and spatial spread of industries and thus stimulate economic activity in different parts of the country.
  • Promote exports and increase foreign exchange earnings, and,
  • Enhance the production of local substitutes for imported goods thereby conserving scarce foreign exchange.

Critics of the policy argue that it has fallen far short of expectations. The anticipated benefits, such as reducing the nation’s substantial import bill, bolstering foreign exchange reserves, adding value to raw materials, and mitigating rural-urban migration, have yet to materialise, leaving the nation vulnerable in the face of the current economic downturn.

Furthermore, experts are concerned about the government’s decision to provide tax exemptions and holidays for the development of a lavish hotel, particularly during a period of heightened revenue needs.

This is not the first time the government has granted a hotel tax exemption. Except that this time, it was under the 1D1F programme.

In 2020, there was a public uproar about the government’s justification for granting Platinum Properties’ Airport City Project a $23.9m tax waiver for the Pullman Accra Airport City Hotel and Serviced Apartments.

This waiver and many others informed the demand for an Exemptions Law which was passed in July 2022 and received Presidential assent in September 2022.

The law set clear eligibility criteria for tax exemptions and provides for the monitoring, evaluation and enforcement of exemptions.

It is also to provide a regulatory regime for monitoring tax exemptions to ensure that exemptions granted are used for the intended purposes, as well as curtail the abuse of the existing exemption regime.

With the government imposing more taxes on businesses and the citizenry to salvage the economy, experts say the government should not be trading off much-needed revenue for luxurious hotels under the guise of a 1D1F programme.

In all these, is 4-Mac Limited or Le Meridien registered in Ghana? Who is the face behind it? All these questions will be answered in the second part of this story.


You may also read:

Newly built 1D1F factories abandoned, some employing far less than the government claims


These 1D1F factories can’t find raw materials, others are broke  





  1. eeeeeeiiii hmmmm… am just speechless. so if the said project started before akuffo addo came into office, what business has it got to do with IDIF.. now, why are we even placing the hotel under 1D1F???

  2. another flagrant violation of the speech I will term ‘protecting the public purse speech’ when the head of this very disappointing administration mounted the podium at his inauguration. Nothing surprised me anymore. However I am seething with anger at the blatant impunity. I can’t wait to thumb my nose after I thumbprint that ballot paper…next elections ?

  3. Assuming over a 20 year span, this hotel generates $500k per annum in taxes for the state, this would amount to $10m and of course most likely would have paid salaries for the same period to 100s of employees not forgetting the Ssnit and othe benefits. Always seeking to create sensationalism to deceive the reader. Parliament used its powers to approve the tax incentives because they had all the necessary information. Here you are speculating at best

  4. Electing MPs who are not patriotic neither having understanding of international rules and regulations is the cause of many bad decisions. Many of the leaders in offices are interested in being called honorable, holding offices than bringing real change to the people they are leading. As citizens we allow politicians to discuss issues on political affiliations and success of party than what will raise the country higher and create jobs. a country where foreigners make profitable businesses than locals due to higher taxes and interest rates. outsiders borrowing at 2-9% as against citizens borrowing at 40% plus with custom duties almost 60%. A country where V8 is more important to MPs than tractors to farm plantations of various crops to make food cheap. A country where promotion of cottage industries to the MPs in farming areas but rather donations of cutlasses, soap and money to be elected. we need to be educated in our various languages on radio of what damages we are doing to our country with what’s happening all around us.


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