Economist, Dr Saeed Iddrisu, has expressed the need for government to reintroduce road toll collection in the country ahead of the mid-year budget review presentation scheduled for today, July 31.
According to him, the initial cancellation of toll collection in the first place was a bad idea. He indicated that the move would help in creating job opportunities for those who were dismissed as a result of the discontinuation of the toll collection.
“I’m looking forward to certain changes made as well. I’m much more particular on e-levy, because if you look at the e-levy, it’s more or less like a nuisance tax. Government is not getting the needed revenue it projected it was going to get.
“Government’s projection before the passing of the e-levy was to be able to get about GHC4.5 billion annually, and so far, estimation is that government is only getting around GHC600 million annually – so government is not making that much. In place of that, I would expect that government will bring back the road tolls – it’s also a way of creating employment for those that were sacked…”Dr Saeed Iddrisu
Dr Iddrisu again stated that the mid-year budget review equally presents an opportune moment for government to reconsider its stance on the implementation of the e-levy. He indicated that the e-levy has “displaced a lot of the momo vendors who were also put out of jobs”.
“So, cancelling will bring back the momo system into full perspective. Also, I would like government to channel the needed resources, whatever taxes they are getting to make, they should be able to channel it into important projects at the moment…”Dr Saeed Iddrisu
Furthermore, Dr Iddrisu noted that government must prioritize the completion of relevant projects in the country. Citing the Agenda 111 project, he explained that it is a priority which government should actually focus on.
Additionally, he revealed that government must necessarily heed to the calls by many stakeholders and experts to take a relook at the COVID levy. He highlighted that scrapping the levy is the best decision now, considering the fact that the World Bank and other organizations have declared an end to COVID-19.
“We are almost less than two years to an election year so the possibility of a change of government is very high and you don’t want to hand over a lot of uncompleted projects to a new government that will take over. So, government should at this point in time focus on important projects and forget about other projects that wouldn’t so much inure to the benefits of the country…”Dr Saeed Iddrisu
State of economy and way forward
On his part, economist and political risk analyst, Dr Theo Acheampong, admitted that although some progress has been made since the beginning of the year in terms of the domestic debt exchange and other related matters, Ghana is by no means out of the woods yet. He underscored that there’s still quite a number of significant headwinds that the economy faces that government has gotten to address.
“For me particularly, coming into the mid-year review today, I’m looking out for four things that we should get some concrete answers to. The first one being, we know that we’ve got a $10.5 billion financing gap that we’ve got to close. This year alone, we are looking to raise about $2.5 billion to close that gap, so we need to hear what the government is doing. In relation to that matter, the issue of the external debt treatments, where are we on those conversations and negotiations and what should we expect from our creditors?”Dr Theo Acheampong
Among other things, Dr Acheampong revealed that he expects the finance minister to touch on the economic reforms that are taking place. He noted that the finance minister must elaborate on where the country is in terms of revenue, expenditure, and tax handle items the country has made progress on.
“Particularly on expenditure, the cuts that were sort of promised because under the IMF programme, you’ve got to do a two-thirds expenditure cut rationalization by the end of the year. We are already halfway into the year, so we should actually see some numbers on where we are really. Thirdly, on the broader monetary sector, what is happening with the Bank of Ghana and those reforms? It will be good to hear some updates on that.”Dr Theo Acheampong
Moreover, Dr Acheampong emphasized the need to know the state on the benchmarks that government is supposed to meet as part of the IMF programme commitment. He indicated that although the board will meet in November, at the end of June this year, government should have met certain benchmarks and criteria.
“One of them is the updated energy sector recovery plan. Again, I think it would be good to get some details from government on those matters.”Dr Theo Acheampong