The Finance Minister Ken Ofori-Atta has said the generally low taxes recorded by the Ghana Revenue Authority (GRA) is a serious threat to government’s ambition of moving the economy from aid dependence.
Speaking at the Danquah Institute’s Economic Forum in Accra, the Minister stated that the country’s current tax to GDP ratio of 13.5 percent falls below the West Africa average of 15.5 percent and below that of South Africa and Tunisia with 29.4 percent and 28.6 percent respectively.
“With such low tax to GDP ratio, we should be concerned about how to move Ghana Beyond Aid and Loans, which are less predictable and costly, than tax revenue. It will be unreasonable on the part of responsible Ghanaian citizens to demand economic transformation if we can’t make domestic tax revenues a significant source of development finance for our country,” Ken Ofori-Atta said.
The Finance Minister assured that the calls for an increase in tax compliance would equally be matched by the Ministry’s desire to protect the public purse by ensuring value for money for all government contracts.
“Over the last two and a half years, we have reviewed contracts and saved the nation hundreds of millions of Ghana Cedis in the process. We are scrutinising contracts better and negotiating better too.
“Also, it is worth restating that the Public Procurement Authority has been able to save about GH¢2 billion in two years. Not a single pesewa was saved by the PPA during a similar period under the previous government,” he stated.
The country’s domestic revenue collection saw a rise from 11 percent (GHs24.2 billion) of GDP in 2016 to 13 percent in 2019 (GHs45.27 billion).
Source: citibusinessnews
