Government Spokesperson on Governance and Security, Palgrave Boakye-Danquah has defended the additional levies approved by Parliament by claiming that they will bolster domestic revenue and improve Ghana’s fiscal position in the wake of the Covid-19 and Russian/Ukrainian war shocks.
Parliament has passed the Excise Duty Amendment Bill 2022, the Growth and Sustainability Levy Bill, 2022, the Ghana Revenue Authority Bill 2022 and the Income Tax Amendment Bill 2022.
According to Boakye-Danquah, this will close the revenue gap for the country and allow it to negotiate a deal with the IMF, preventing any unforseen disaster from further affecting the country’s finances.
“So, this is a set of measures we must ensure is worth passing. This is a major bridge we have to cross in closing this revenue gap and ensure that there is more liquidity”,Boakye-Danquah told Moro Awudu on Inside Pages on Accra-based Metro TV.
“We are not in a good place because we don’t have access to the international capital market. Having hard currency to service our import obligations is significantly being threatened.”
“It is important we complete all prior actions, lock up this deal and get a shore up best from the IMF and other inflow sources and do certain broad things to ensure that the economy doesn’t crash and expand investments that will bring economic inclusion. We need to do what must be done to ensure that we cement the kind of relative stability we have had in the last four to five months and gradually begin to reverse the economic challenges we have had.”
He is very optimistic that these revenue bills will bring in almost ¢5 billion to support the economy.
He further averred that the revenue plan is to aid in bridging the revenue gap due to the inability of the government to collect taxes during the Covid-19 pandemic.
“It is to help to correct the imbalance we are currently experiencing. This is not new but the essence of it is to rake in revenue to address the shortfalls we encountered during the Covid-period and the war between Ukraine and Russia”.
He claimed that the minimum wage earners would still be exempted from taxes under the Income Tax Amendment Bill, which is anticipated to bring in ¢1.2 billion.
The Levy will ensure profit before tax of companies and institutions and on production in the case of mining, upstream oil and gas companies.
The estimated revenue for 2023 is approximately ¢2.26 billion.
It is also intended to increase the optional rate for individuals on the gain from the realisation of an investment asset, revise the upper limits for the quantification of motor vehicle benefits and increase the concessional income.