Experts call for review of tax exemption laws, accountability to boost tax compliance

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Tax accountability is a sure way for the government to encourage the country’s citizens to pay their taxes in order to contribute to national development, some experts and industry players have asserted.

This opinion was espoused in a roundtable discussion organized by the Ghana Center for Democratic Development (CDD-Ghana) on “Taxation and Accountability in Ghana.”

In its 2021 Budget Statement and Economic Policy, the government introduced six new levies and increased other existing taxes, with the aim of fortifying the country’s public finances.

While some have argued that the imposition of these new taxes was ill-timed, others have bemoaned the lack of infrastructural development after years of paying various taxes.

Findings from the Afrobarometer Round 8 survey conducted in 2019 indicate that although majority of Ghanaians (72%) are willing to pay more in taxes to help finance the country’s development from domestic resources, a similar percentage of the population (70%) say they find it “difficult” or “very difficult” getting information about what the government does with the taxes it collects.

Thus, the CDD-Ghana’s roundtable discussion served as a platform for policymakers, tax experts, and representatives from institutions and associations such as the Ghana Revenue Authority (GRA), the Trades Union Congress (TUC) and the Association of Ghana Industries (AGI) to interrogate how the country can achieve a clear and effective balance between the concerns for accountability, negative economic impact and the essential need to finance development in the COVID era.

The panellists identified that the lack of accountability, the embezzlement of public funds, and the abuse of tax exemptions as some of the key factors influencing tax evasion and lack of tax compliance.

Kwaku Kwarteng, the Chairman of Parliament’s Finance Committee and Member of Parliament (MP) for Obuasi West, stressed the importance of being transparent and accountable to citizens on how tax revenues are spent.

“It is important for us to hold government and public office holders accountable when it comes to taxation because citizens need to know that the monies they pay to the state by way of taxes are being put to good use,” he said.

The former Deputy Finance Minister encouraged businesses, individuals and the general public to honour their tax obligations to boost the internally-generated revenue needed to address the developmental needs of the country.

Dr. Ato Forson, Ranking Member on Parliament’s Finance Committee and MP for Ajumako-Enyan-Essiam, was of the view that tax increments and the introduction of new levies were not the solution to increasing tax revenues.

He recommended the enforcement of tax laws, true accountability on tax revenues and an urgent review of tax treaties and exemptions which, according to him, are being abused by some multi-national institutions and certain individuals.

On his part, Prof. William Baah-Boateng, Head of the Economics Department at the University of Ghana, advocated for the digitization of the payment of direct taxes and the review of the existing tax exemption laws to block loopholes that cause the state to lose revenue meant for national development.

Mr. Abeku Gyan-Quansah, a Tax Partner at PricewaterhouseCoopers (PwC), supported calls for the passage of the Tax Exemptions Bill which was submitted in Parliament in 2019.

CDD-Ghana’s roundtable discussions provide an avenue and space for well-informed reflections and conversations on various topics of national interest.

The discussion on ‘Taxation and Accountability in Ghana’ which is the fourth in the series of roundtables to be organized this year, forms part of the Center’s commitment to ensuring inclusive development by educating citizens on taxation and encouraging the demand for government accountability on tax expenditure while advocating for tax reforms.

Source:
CDD

Source: citinewsroom