Development Economist Dr. Frank Bannor has lauded the proposed tax reforms by the governing New Patriotic Party (NPP) flagbearer for the 2024 general election, Dr. Mahamudu Bawumia.
According to him, Dr. Bawumia’s tax reforms are what Ghana needs for its accelerated growth and development.
Dr. Bannor who is also the Head of Research at Danquah Institute indicated that Ghana’s tax regime is too cumbersome and makes it difficult for citizens to honour their tax obligations.
“If citizens know they’re likely to reap benefits from filing their tax returns, they’ll gladly file their tax returns. South Africa has shown the way, go to Johannesburg and see how happy citizens become queuing to file their taxes.
“Our meetings with organized labour including GUTA, Ghana Pharmaceutical Association, Ghana Medical Association and others have shown that the existing tax system is too cumbersome for them, and this brings about disputes and conflicts between them and the Ghana Revenue Authority” Dr. Bannor stated.
He emphasized that if business owners are not informed adequately about how much they are to pay as taxes based upon earnings, a phenomenon that sometimes leads to GRA officials demanding more taxes than what business owners are to pay, many businesses will suffer and run away from paying taxes.
“It is upon this that Vice President Bawumia, when he met the leadership of Ghana Chamber of Commerce that he pledged to do away with the existing tax system and replace it with a flat rated tax system, a very flexible tax regime and grant tax amnesty to motivate citizens to file their taxes at the end of every year” he said.
Dr. Bannor noted that granting tax amnesty will give those who owe taxes an opportunity to be forgiven all or most of the taxes they owe the state, and this is what Ghana needs.
This, he further explained, would bring in more revenues into the consolidated fund and rope in more people into the tax basket.
The Development Economist made these remarks when he appeared on Adom TV’s Badwam morning show hosted by Omanhene Kwabena Asante.
The NPP flagbearer and Vice President, Dr. Bawumia, at his meeting with the members of his party in February 2024, at the University for Professional Studies, outlined his vision for Ghana if elected president in the 2024 elections.
On taxation, the Vice President stated that, amongst other policies, he will adopt measures to bring seamlessness into the country’s tax system.
They include the introduce a very simple, citizen and business friendly flat tax regime, a flat tax of a % of income for individuals and SMEs (which constitute 98% of all businesses in Ghana) with appropriate exemption thresholds set to protect the poor and tax amnesty.
Others are electronic and faceless audits by GRA, no taxes on digital payments and hence the e-levy will therefore be abolished, no VAT on electricity (if still on books), no emissions tax and no betting tax.
Dr. Bawumia also announced that Tema port will be fully automated and that there will be a new policy of aligning the duties and charges the port to the duties and charges at Lome Port.
He also indicated that spare parts import duties will be at a flat rate per 20 or 40 foot containers.
According to Dr. Frank Bannor, these tax measures, if introduced in Ghana by Dr. Bawumia, will go a long way in ensuring that Ghana’s economic trajectory remains robust.
