A professor of Economics at the University of Ghana Business School, Godfred Bokpin has intimated that an efficient tax regime is what is needed to help Ghana raise the needed revenue and not additional ineffective tax bills.
Professor Bokpin bemoaned the many existing taxes which he stated if properly implemented, should have been enough to raise the needed revenue for the government.
He indicated it will be difficult for the government to boost the economy using taxes because far too few people are burdened with taxes while the larger population is not captured in the tax bracket.
“There is no way you can grow your economy with the number of taxes we have in the country. We have so many taxes in the country yet still we want to introduce more to raise more revenue.
“We are just burdening a faithful few in terms of deepening the tax system rather than broadening it, and we can close the gap by improving efficiency. The inefficiency in our VAT alone is 2.87 percent of our GDP, in other words, we could generate more than $1 billion without increasing the rate of VAT.”
“If you look at corporate tax rates, it is just a few that are captured, the inefficiency in our corporate tax productivity is more than 75 percent, and you don’t close the gap by introducing additional taxes and also increasing the rates paid,” Professor Bokpin added in an interview on Eyewitness News on Citi FM.
The government is seeking to have three new revenue bills passed by parliament as it seeks to rake in GH¢4 billion per year to shore up revenue to fix the ailing economy and secure a Board approval for a bailout from the International Monetary Fund (IMF).
The bills which include the Excise Tax Stamp and Excise Duty amendment bills, Income Tax amendment bill and Growth and Sustainability levy bill are already being rejected by some business groups and Parliament is expected to vote on the bills today [March 31].
