Vice President of Imani Africa, Bright Simons, has called on government to admit that the e-levy and other policies which were resisted by Ghanaians are underperforming.
According to him, ahead of the mid-year budget review by the Finance Minister Ken Ofori Atta today, Monday, July 25, 2022, the finance minister should be transparent on the true nature of these policies. He indicated that investors will be looking at whether government makes these recognitions or they just engage in posturing.
“[Ken Ofori-Atta] must also be a bit more humble and admit that the domestic programmes are not going well as they said it would. Some of that will be acknowledgement of revenue handles that they are talking about and their performance. Where I will be most interested in is whether or not it is sufficiently candid in admitting that some of these policy restrictions that were fiercely resisted are also having negative effect, not just that, they are under-performing.”
Bright Simons
Mr Simons revealed that the e-levy has equally had“cross effect on other revenue mentions” because of its impacts on sentiments. These, he noted, are going to reflect in consumption taxes.
“So, some of us will be looking very closely at VAT and its performance, we will be looking very closely at Corporate Taxes and its outturn.”
Bright Simons
The IMANI Vice President highlighted that scrutiny will be on whether the government recognizes at this stage that it is beginning to “lose credibility as being capable of taking these decisions in good faith or simply posturing”. He stated that, that is the biggest issue facing the government now.
“If investors get the view that they are just posturing, they don’t tend to do things fundamentally different. They will not be able to achieve their most important policy objectives right now which is to reduce the cost of our debt. If they don’t bring down the international rate it will affect everything else. This 20 per cent yield, 22 per cent yield moving to 25 per cent yield, is moving the country aggressively towards a duration where we have a default.”
Government urged to suspend some policies
On his part, a Financial Analyst and Chief Operations Officer at the Dalex Finance, Mr Joe Jackson, requested the government to cut spending on some programmes especially the feeding component of the free Senior High School (SHS) programme. He emphasized that the country is not in a strong financial position to take on such policy.
Mr Jackson emphasized that critical decisions must be taken by managers of the economy to look at ways to cut expenditure.
“It is time for us to look at all the expenditure cuts, it is time for us to look and wonder, do we want to spend this much on feeding and boarding in the SHS regime? Is this what we want to spend our money in the such difficult times on? These are hard times, there are hard decisions to be taken and one of the things we must realize is that Ghana is broke.”
Joe Jackson
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