The Ghana Trades Union Congress has urged government to reconsider the tax exemptions captured in the 2021 Budget. In its preliminary evaluation of the 2021 budget, the Union also called for the taxes abolishment as they have outlived their usefulness.

It insists that there must be a comprehensive review of benchmark values in calculating import tariffs. This also includes fees and levies at the ports.

“An increase in the benchmark values for all products that have local substitutes will raise revenue and support the import-substitution agenda under the Ghana-CARES programme”.

Additionally, it stated that the economic and social damage caused by COVID-19 is huge. As a result, the “figures from the 2021 budget paint a dire picture of government finances”.

Job losses make tax approach risky

Currently, Government has proposed some tax measures to raise revenue. However, the Trades Union has disclosed that job losses make the tax approach a risk venture.

“However, we support the proposed 5 percent levy on the banking sector. Considering the huge sums that have been poured into saving the banking sector, it makes economic sense for the banking industry to pay back”.

“Property tax can be another important source of government revenue if its collection can be properly coordinated by central government. It appears that the District/Municipal/Metropolitan Assemblies have neither the capacity nor the incentives to collect property taxes.”

The Union also noted that the budget is silent on employment-creation strategies from the government in helping to assuage the unemployment crisis. They however, acknowledged government’s effort in preserving jobs.

“We acknowledge the efforts government is making to preserve jobs and protect incomes in the public sector. We also recognize the US$750 million support to enterprises in the form of the Coronavirus Alleviation Programme – Business Support Scheme (CAP-BuSS). These are important initiatives”.

Unemployment insurance pensions

Government has committed to establishing the National Unemployment Insurance Scheme (NUIS). With this, the government will engage in training and retraining programmes in 2021.

The Trades Union commended government on the move by describing it as a “social protection measure”. It noted that it will strengthen the “operations of the Ghanaian labour market”

“A National Unemployment Scheme that offers direct income support to workers who become unemployed in times of a crisis like the COVID-19 pandemic is a unique social protection measure. By offering opportunities for training and retraining, support for job search, apprenticeship and internship, the scheme will help reduce the suffering of the unemployed, preserve their human capital and dignity and ensure social stability”.

It therefore concerted to working with government and other social partners towards the smooth operations of the Insurance Scheme. And also aid in its training and retraining programmes.

A study by African Centre for Retirement Research showed 81% of workers who retired in 2020 experienced shortfalls in lump-sum. This is in comparison to the lump-sum they would have received under PNDC Law 247. Those retiring in 2021 and beyond are likely to suffer the same fate.

Government has already approved a top-up of lump-sum benefits for retirees, following TUC’s petition to the President to intervene.

The TUC said it expect the lump-sum top-up to be paid to eligible retirees in the first half of this year.