Dr. Said Boakye , a Senior Research Fellow at the Institute of Fiscal Studies has advised government not to resort to the imposition of additional taxes in the country but to outline measures that will ensure proper management of its expenditures to reduce the pressure on the country’s fiscal position.
According to him, excessive taxation will exert a downward pressure on the economy which runs counter to the government’s efforts to revive the economy which is still struggling to weather the storms of the pandemic. He noted that the government had already violated its own philosophy of a shift from the imposition of taxes at the beginning of its administration .
“If it is left to me alone, I will say they should not [impose additional taxes]. Because that contradicts their philosophy in which they said they were going to shift attention from taxation. In other words, they were not going to increase taxes but lower them. I advise that they don’t go that direction but try to manage expenditure. I didn’t expect that they were going to resort to increasing taxes even to begin with. But I will advise that they don’t go that way because we want to stimulate the economy and taxes have downward impact on economic activities”.
Dr. Said Boakye
The Research Fellow gave this advice whilst sharing his expectations with The Vaultz News on the Mid-Year Review Budget Statement and Economic Policy of Government; the government’s supplementary estimate for the 2021 financial year, to be presented on the floor of Parliament today, Thursday, July 29 by Ghana’s Finance Minister, Mr. Ken Ofori-Atta.
New taxes, cause of youth uprising
Meanwhile, still commenting on the new taxes imposed, Dr. Said Boakye noted that their imposition was one of the reasons that sparked the #Fixthecountry movement earlier this year.
“And also, I believe the #Fixthecountry movement, the taxes that we impose partly induced it. If we increase too many taxes, it could lead to backlash, causing instability and nobody is interested in that. That’s why I advise that if they have that vision, they shouldn’t go ahead to do that”.
Dr. Said Boakye
Need to assure Ghanaians
Furthermore, Dr. Said Boakye indicated that the government would not be able to meet its revenue targets for the first half of the year because it is overly ambitious and as such, the government should assure Ghanaians that it is doing everything possible to step-up its revenue mobilization efforts. To this end, he is charging the government to look for other ways of raising revenues aside the imposition of taxes, which to him, is no longer an option for government.
“My expectation is that, of course, they will not be able to meet the revenue target because it was overly ambitious. Based on data that Bank of Ghana brought currently, given the first five months of the year, you can clearly see that government will not be able to meet its revenue target for the first half of the year.
“And for that matter, I expect them to assure Ghanaians that they are re-doubling their efforts to increase revenue mobilization. Because of revenue, we have to scale-down expenditures. For that matter capital expenditure will suffer and these are some of what I expect to see”.
Dr. Said Boakye
Meanwhile, the stakes are high as the Finance Minister presents the Mid-Year Review Budget today with many experts calling on the government to tell Ghanaians the impact of the imposition of the taxes on the economy so far. Some analysts even call for the withdrawal of the taxes, since to such people, these taxes are doing more harm than good. Nevertheless, all these remain wishes until the government who is in the driving seat tells us what it wants to do to consolidate the steady progress the country is making to recover from the pandemic.
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