Joe Jackson, the Director of Business Operations at Dalex Finance, has called on the government to go beyond digitization in order to broaden the tax net and introduce progressive taxes on wealthy and luxury items in order to generate more revenue.
He also railed against tax breaks given to private enterprises in the country, claiming that they thwart the government’s revenue-generating efforts.
“The mere fact of identifying somebody, although it is excellent, will not solve the problem. Unless someone is willing to follow up and ensure the taxes are collected. The taxes should be such that the rich pays more… These tax exemptions are troublesome.”
On Point of View, Joe Jackson stated that the economy is in a dismal situation and that immediate steps must be taken to inject capital to keep it afloat.
According to Joe Jackson, the government’s inability to announce actions to cushion citizens is due to the lack of revenues generated, the high debt servicing rate, and the government’s massive borrowing.
He contends that, with markets afraid of lending to Ghana due to the country’s severe economic state, the 2022 budget should focus on restoring investor confidence and assuring lenders that Ghana is doing everything possible to stabilize the economy.
“The budget must signal better management to the market so that we can borrow because we still have to borrow. They have to know that we are doing our best to manage our affairs so that we can borrow at reasonable rates.”
Joe Jackson, Economic Analyst
The need to restore back Investors’ Confidence
Meanwhile, financial analyst, Toma Imihere stated that Ghana’s bond market image has deteriorated and that actions must be taken to restore investor trust in the country’s economy.
Ghana’s recent foray into the bond market did not go well, he added, and because the government can do nothing about it, it must look to other domestic sources of money to fund planned projects and service mounting debts.
“Even the willingness of people to lend to us is gone. When we went to the bond market in March, we said we were going to take $5 billion dollars if the price was right, eventually, we were offered $6 billion dollars but the problem was that half of it, the prices, the interest rate was too high for us so we got only $3 billion. The government said it was oversubscribed but that is not true.”
Toma Imihere, Financial Analyst
Government must go after the wealthy and the political class.
He criticized the government for refusing to go after the wealthy and political class in order to obtain cash to address the economy’s severe situation, instead of imposing taxes that worsen the situation for the poor.
“Our political elites are self-serving. The people who set the tax laws don’t want to put taxes where they will pay more.”
Toma Imihere, Financial Analyst
On November 17, 2021, Finance Minister Ken Ofori-Atta is slated to present the national budget for 2022 to parliament.
Before the budget is presented, there are already various expectations on the government, including demands for a relief package for unhappy Menzgold consumers in the budget.
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