Minister-designate for Finance and Economic Planning Mr Ken Ofori-Atta has identified revenue mobilisation under property rates, tax exemption and digitization of tax administration and collection as three key areas of focus to recover the economy from the devastating effect of COVID-19 if approved by Parliament.
These key areas, according to him, will help push the current low tax-to-GDP ratio of about 12.5 percent to the proposed tax-to-GDP ratio of at least 17 percent in our bid to moving Ghana Beyond Aid.
Appearing before Parliament’s Appointment Committee for vetting on Friday, Mr Ofori-Atta described the 2021 budget statement “as a battle cry” for all Ghanaians “to share the burden” that COVID-19 pandemic has placed on Ghana.
He added that aside the need to burden share, “we must also not lose sight of the fact that the 2021 budget seeks to complete at least 8,700 projects, as our way of bringing finality to the culture of not completing projects previously done with tax payers monies.
“Consolidation is important for us because the macroeconomic indicators have been stable and clearly what we did in the past three and half years was what was able to support us in 2020 when the pandemic hit”.
Responding to questions before the parliamentary committee, Mr Ofori-Atta called for adoption of positive behavioural change as it is a critical driver for realising President Akufo-Addo’s vision of a Ghana Beyond Aid.
He rejected accusations indicating that Ghanaian taxpayers are worse-off today because the Akufo-Addo-led administration has imposed so many taxes on them.
Mr Ken Ofori-Atta stated that a critical analysis of the taxes abolished during the first term of the New Patriotic Party (NPP) administration showed that taxpayers in net terms are better off now than under the previous National Democratic Congress (NDC) administration.
“When you look at the taxes we abolished, reduction in electricity and what we have done during this COVID-19 era, clearly on a net bases we have not really hurt the Ghanaian taxpayer, if you compare us to the previous government,” he stressed.
He appealed to Ghanaians to embrace the call to share the financial burden of the state and be assured that the government is still committed to moving the economy from taxation to production with its good policies.
Mr Ofori-Atta said that burden-sharing will not only help transform the country but also ensure the country also shares the opportunities that will emanate from our common efforts at building the Ghana we all want.
He said the country needs to address its many challenges, adding that “we must boldly and innovatively embrace the opportunities that COVID-19 present us as a people and leverage them to grow the country in a collaborative manner”.
Mr Ofori-Atta urged all to put all hands on deck to grow and transform Ghana as opposed to “bending our heads down because in adversity that our ingenuity and enterprise must count”. He reminded Ghanaians that there are no good times ever for taxes, but the proposed tax measures in the 2021 budget are necessary to help deal with excess energy capacity charges, adverse effects of COVID-19, payment for COVID-19 vaccines and the huge sanitation problem that currently confront the nation.
He gave assurance that government that all the revenue to be realised from the proposed tax measures will be put to good use across the country.
Mr Ofori-Atta said prior to the emergence of COVID-19 pandemic, Ghana’s economy and fiscal health was better in 2019 than in 2016.
“For the past four years, the economy has grown, social protection for the vulnerable has been increased, and the conditions of people have been made better, by the grace of God,” he stated.