Former finance minister, Seth Terkper, has disclosed some deprivations with respect to calls for Presidents of the country to pay taxes.
According to him, the calls are not necessarily justified because the matter mut be discussed a bit more comprehensively. He revealed that Presidents pay income when there are business interests and he earns profits from same.
However, he noted that Presidents are not privileged to engage in such profit-making ventures.
“I recall that some former Presidents do file their returns, which implied that they paid income tax on other related activities. So, it appears the Presidents would pay taxes on incomes that are not related to the employment of his or her office. We should also know that when a President is in office and even when he leaves, there are deprivations and frictions…”Seth Terkper
Elaborating on the deprivation of Presidents when it comes to income tax payment, Mr Terkper explained that per article 68(1) of the constitution “the President shall not, while he continues in his office as President, hold any other office of profits or emolument, where private or public”. This, he stated, is a “major deprivation”.
“Then two says that the President shall not on leaving office as President hold any profit or emoluments, except with permission of parliament in any establishment, either directly or indirectly other than that of the state…
“So, I’d like to draw your attention to these deprivations, so that in saying the President should pay tax, are we also going to leave these restrictions? Because there are countries where even when the President is invited and speaks, they charge for that invitation…”Seth Terkper
Furthermore, Mr Terkper emphasized that Presidents once they assume office, become disengaged from pursuing “business interest, family interest and income” or engaging in anything profitable. With this, he questioned whether such a President would want his salary to be taxed as well.
“Yes, I do agree that it is probably a good thing to demonstrate, but when you look at the quantum and look at these restrictions, then I think we need to widen the discussion.”Seth Terkper
Presidents’ taxation a motivational tool to citizens
Moreover, the former finance minister expressed that except for its symbolic importance, in terms of taking into consideration the current institution, it will motivate the rest of the population, probably by way of example.
Nonetheless, he reckoned that he doesn’t see it making any significant impact.
” Let me also draw your attention to the fact that I believe in exemptions – items bought for the President’s office, you know, are also exempted from tax… That I think I would agree that it’s a state office… There are countries also where when a President receives gifts above a certain level, they have to surrender them to the state…”Seth Terkper
It will be recalled that an Assistant Commissioner of the Ghana Revenue Authority (GRA), Dominic Naab, during a public forum which tackled exemption of the President of Ghana from paying income tax, argued that it should be subject to a national conversation.
He stated that the framers of Ghana’s laws had considered the immense pressures and negative impacts of the presidential role, such as insults and scrutiny, and decided to provide an incentive by excluding Presidents from paying income tax.
Reacting to reasons why Presidents are exempt from taxes but not citizens, Mr Naab clarified that the GRA is an implementation agency and does not formulate tax laws.
Hr suggested that those dissatisfied with the existing provisions should initiate a national conversation on the matter.
Furthermore, Mr Naab emphasized the importance of tax compliance among all Ghanaians and assured the audience that the GRA is actively working to widen the tax net and enhance the convenience and comfort of tax payment.