President of the Ghana Union of Traders Association, Dr. Joseph Obeng, has expressed satisfaction that all the leading presidential aspirants are sharing policy statements on their willingness to change Ghana’s existing tax regimes. Dr. Obeng says it is refreshing that the leading aspirants are engaging the business community.
Speaking exclusively to happyghana.com, Dr. Obeng expressed concern over the prevailing tax regime that is adversely affecting traders and businesses in the country. According to him, Ghana has one of the highest numbers of taxes although the country’s tax-to-GDP ratio falls below its peers within the West African sub-region.
Ghana’s tax-to-GDP ratio hovers around 14%, one of the lowest within sub-Saharan Africa region signaling inefficiencies in Ghana’s revenue mobilization strategy. Successive governments have grappled with instituting effective means of improving Ghana’s revenue mobilization but are yet to achieve real success.
Dr. Obeng avers the identified inefficiencies are largely due to the complex nature of Ghana’s tax systems. He says the complexities disincentivize taxpayers leading to tax evasion and avoidance. According to Dr. Obeng, it should be the goal of every government to harmonize tax systems, and make them simpler for taxpayers to comply.
NPP’s flagbearer and Vice President, Dr. Mahamudu Bawumia on the 5th of April met with GUTA and shared his proposed tax reforms when voted for in the December, 2024 polls. The Vice President mentioned, among other things, tax amnesty and flat tax rates for businesses and individuals, flat-rate duties on containers, as well as benchmarking import duties with Togo to ensure uniformity and also eliminate smuggling.
Former President and Flagbearer of the NDC, John Dramani Mahama, has also shared his vision of rationalizing charges at the ports and aims to scrap needless levies, fees, particularly at the port. The former president expressed shock at 22 levies and fees that importers would have to pay before clearing goods at the port. He has promised to scrap some to alleviate the burden on traders. He has also promised to expand the tax net to reduce the burden on the formal sector.
Leader for the Movement for Change, Alan Kyerementen, has waded into the tax conversation promising of achieving the lowest tax rates in the ECOWAS sub-region within a period of three years through the elimination of existing compounded calculation of VAT and consolidating the NHIA and GETFund levies with VAT rate; abolishing special import levy and COVID-19 levy as well as review and consolidate all statutory fees and charges on imports imposed by regulatory agencies and redistribute same through a cash waterfall mechanism among other proposals.
But, Dr. Obeng says all these policy statements cannot be considered as sacrosanct although many of the reforms are implementable.
“All the parties are now in the process of formulating their manifestos and so I cannot conclusively say this policy is better than the other. We, as an association, would have to digest all their policy proposals before making a definitive statement on which tax strategy that will help” Dr. Obeng posited in an exclusive interview with happyghana.com.
To him, the fact that these aspirants and political parties are considering taking action on Ghana’s current tax system in itself is fulfilling. According to him, the core of the review of Ghana’s tax system should be to reduce the number of taxes paid and also harmonize some for easy payment.
Sefah-Danquah.