Ghana's Member of Parliament for Tano North, Dr. Gideon Boako, has sounded a warning to the Mahama government regarding its plans to scrap the electronic levy (e-levy) and betting taxes. While acknowledging the government's intention to abolish these taxes, Dr. Boako cautioned against introducing alternative taxes through the back door.
The controversy surrounding the e-levy and betting taxes has sparked a heated debate about Ghana's fiscal challenges. The government's promise to abolish these taxes in its first budget has been met with skepticism by some, who argue that it could result in significant revenue shortfalls.
Dr. Boako emphasized that the government's approach could conflict with the requirements of the International Monetary Fund (IMF), which demands robust revenue generation to meet debt servicing obligations . He argued that cutting expenditure, as suggested by Finance Minister nominee Dr. Cassiel Ato Forson, does not address the problem, as the IMF focuses on debt service to revenue ratio, not debt service to expenditure ratio.
The IMF has been working closely with Ghana to stabilize its economy and address its fiscal challenges. Ghana's economic program, supported by the IMF, aims to restore macroeconomic stability, secure debt sustainability, and lay the foundations for higher and more inclusive growth .
Dr. Boako's concerns are not unfounded, given Ghana's history of fiscal challenges. The country has struggled with large fiscal and external imbalances, macroeconomic instability, and a slowdown in economic growth . To address these challenges, the government must adopt a more comprehensive approach to managing its revenue needs.
Dr. Boako urged policymakers to consider the long-term impact of their decisions and to be transparent and pragmatic in managing the country's revenue needs. He cautioned against creating false hope by abolishing taxes only to replace them with alternative levies.
As Ghana navigates its fiscal challenges, it is essential to prioritize transparency, accountability, and sustainability in its economic policies. The government must work closely with stakeholders, including the IMF, to develop a comprehensive plan that addresses its revenue needs while promoting economic growth and stability.
blogpay
Total Comments: 0