The Ghana Revenu Authority (GRA) is currently facing challenges in determining the appropriate tax classification for political party funds.
The GRA has not yet made a decision regarding whether to impose taxes on these funds.
According to Edward Agyambra, the Head of Domestic Tax Revenue Division at the GRA, there is uncertainty about the most appropriate tax category for these funds, despite efforts to expand the tax base.
“The political fundraising, the question is are you describing it as a gift or donation or is a business that they are getting? I think that is a challenge, but I will sit with my team and see if the source must be taxed, why not,” he stated.
Meanwhile, the Domestic Tax Revenue Division of GRA says it has generated GH¢15 million from the recently implemented bet tax within a month.
The tax collector is optimistic that this amount will reach GH¢60 million before the football season ends.
Edward Gyambra, expressed confidence that the Authority will surpass its revenue targets by the end of the year.
Political parties fund their campaigns and political activities through fundraising and support from their members. However, the funding of political parties has been questioned over the years.
Former President John Dramani Mahama, in March 2023, suggested that the state finances campaigns of viable political parties in order to prevent financiers from determining electoral outcomes.
Mr. Mahama is of the opinion that the state must bear some of the cost incurred by political parties during elections to ease the burden on the various parties.
Speaking during a public lecture on March 22, at UPSA auditorium in Accra, Mr. Mahama, a flagbearer hopeful of the National Democratic Congress (NDC) opined that, “on government support for political funding, some have argued that the only funding that may be advanced to parties and cannot be concealed in secrecy is public funding. This refers to government giving financial resources or indirect assistance to political parties. In the absence of such support, and given the huge cost of political activities, wealthy party financiers may take over as political godfathers who determine electoral outcomes and all that follows it”.
Mr Johnson Asiedu Nketia, National Chairman and former General Secretary of the National Democratic Congress (NDC), in 2020 described the country’s laws on political party financing and campaigning as vague and called for it to be strengthened.
He said the laws must be expanded to set a limit of funding for every parliamentary candidate during an election and also demand that they declare their sources of funding.
“The campaign financing laws must be specific as to which activities can be financed, how much to spend on each activity and must make it mandatory for candidates to disclose their sources of funding”, he said.