A Professor at the University of Ghana Business School, Lord Mensah has asked the government to give Ghanaians tax incentives in the mid-year budget review following the rising rate of inflation which currently stands at 29.8 per cent in June 2022, up from the 27.6 per cent recorded in May same year.
Prof Lord Mensah said he also expects that the government will some expenditure line to save the economy.
“We are going to have a major budget review, several expenditure lines will be sacrifice,” he said on the New Day show with Johnnie Hughes on TV3 Monday July 25.
He added “for the people, I expect the government to give them tax incentives.”
The Finance Minister Ken Ofori-Atta will be presenting the 2022 mid year budget review today Monday July 25 at 1PM.
Analysts including the Vice President of Imani Africa, Mr Bright Simons said, ahead of the review that the Minister must admit failings with some of the policies that were resisted in Parliament especially the e-levy.
Speaking in an interview with TV3 ahead of the budget review, on Thursday July 21, Mr Simons said investors will be looking at whether government makes these recognitions or they just engage in posturing.
“[Ken Ofori-Atta] must also be a bit more humble and admit that the domestic programmes are not going well as they said it would. Some of that will be acknowledgement of revenue handles that they are talking about and their performance. Where I will be most interested in whether or not it is sufficiently candid is admitting that some of these policy restrictions that were fiercely resisted are also having negative effect, not just they are under-performing.
“I think that e-levy has a cross effect on other revenue mentions because of its impacts on sentiments. We are going to start seeing that in Consumption Taxes. So some of us will be looking very closely at VAT and its performance, we will be looking very closely at Corporate Taxes and its out turn.
“We will be looking to see whether the government recognizes at this stage that it is beginning to lose credibility as being capable of taking these decisions in good faith or simply posturing.
“I think that is the biggest issue facing the government now. If investors get the view that they are just posturing, they don’t tend to do things fundamentally different, they will not be able to achieve their most important policy objectives right now which is to reduce the cost of our debt. If they don’t bring down the international rate it will affect everything else. This 20 per cent yield, 22 per cent yield moving to 25 per cent yield is moving the country aggressively towards a duration where we have a default,” he said.
By Laud Nartey|3news.com|Ghana