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    ‘Pay your taxes to help revive economy’ – Kwarteng

    The chairman of parliament’s finance committee, Kwaku Agyemang Kwarteng, has called for a renewed commitment to payment of taxes to help government overturn the current economic challenges.

    Although he said rationalisation of the government’s expenditure is equally important in the recovery process, he admitted that it is not enough – underscoring the need to raise more domestic revenue.

    The Obuasi West Member of Parliament also cautioned against granting tax exemptions to certain individuals and entities, stressing that such exemptions – in the name of investment promotion -represent a challenge; and as such do not always offer value for money.

    “It will not be sufficient to just handle expenditure. We need to ramp up our efforts to mobilise more domestic revenue. Everyone will have to pay their fair share of taxes.

    “The practice of keeping our taxes in place and yet seeking to exempt selected individuals from payment of those taxes is completely unhelpful. It takes everybody to contribute in our efforts at mobilising domestic revenue,” he said.

    “By exempting individuals in the name of investment promotion,” he said, “we are creating problems. We deny Ghana the opportunity of communicating that our investment climate is strengthening because those taxes are in place. By encouraging the practice of selecting individuals and excluding them from taxation, we are creating opportunities for corruption.

    “So, I take this opportunity to call on not just government but also ourselves to ensure that we get everybody to pay taxes. If we want to lower taxes, we should abolish those tax lines and let everybody be free of those taxes,” he noted.

    The MP was speaking on the floor of the House following the Mid-Year Fiscal Policy Review of the 2023 Budget Statement and Economic Policy presented to parliament by finance minister Ken Ofori-Atta on Monday 31st July 2023.

    Mr. Kwarteng, in his submission, also cautioned government against investing in new projects which put a strain on the public purse, and rather commit to completing older projects to help the economy live within its means.

    “As we respond to this call to help our own country overcome the economic challenges, what should we do? What we should do is perhaps more clearly stated in what we should not do. We should stop putting pressure on government to spend on projects for which we have no money; and especially now, we should be asking government to spend on projects to which we are already committed. The arrears that have piled – some of them very historical, let us put the resources we have into those arrears. Let us stop putting pressure on government to take on new commitments,” he urged.

    Widening the tax net

    Currently, government is leveraging digitalisation – including initiatives such as the e-VAT, e-Levy and Ghana.gov among others – to expand the tax net, eliminate leakages and close the tax gap.

    The Minister of State at the Ministry of Finance, Dr. Mohammed Amin Adam, a couple of weeks ago told parliament that results from the pilot phase of the e-VAT are encouraging; and that the Ghana Revenue Authority (GRA) is eager to ride on its success to widen the tax net.

    “Results from the e-VAT pilot phase supplemented with physical monitoring by GRA staff are truly revealing. The initial results have emboldened us to expand coverage to other targetted entities,” he told parliament when appearing before the House to answer questions from members.

    Dr. Adam further noted that government is keen on unlocking the full potential of domestic revenue mobilisation for the country.

    In his 2023 Mid-Year Budget Review, Ken Ofori-Atta noted that his office, during the document’s preparation, held extensive engagements with Cabinet and diverse stakeholders on different issues including widening the tax net.

    “In all these meetings, stakeholders provided insights into issues such as widening the tax net, SOE governance, expenditure controls, optimising extractive industry contributions, providing increased and targetted support to agriculture and industry, revamping ports’ operations and duties, as well as growing and changing the economy’s structure.

    “The feedback has been illuminating and well-received. The faith-based organisations, for example, agreed to form a committee to educate their congregations on their responsibility to pay taxes. We will continue engaging to find mutually acceptable solutions as we prepare the 2024 Budget Statement in November 2023,” the finance minister added.

    Source: thebftonline.com

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