Head of finance at the University of Ghana Business School, Professor Godfred Bokpin, has called for an overhaul of the tax exemption regime in Ghana.
He is of the view that the country loses a lot of revenue as a result of the nature of tax exemption policies.
According to him, government does not need to necessarily introduce new taxes to raise more revenue but can review the tax exemption regime.
Currently, companies under the country’s Free Zone enjoy a 10-year tax holiday, something business analysts have criticised, arguing it undermines the country’s revenue mobilisation efforts.
Also Parliament in June this year approved a 259 million-dollar tax waiver for AngloGold Ashanti with the view making the company more profitable and to be able to create more jobs for the next seven
The Minister of Finance, Ken Ofori-Atta, in April hinted of a possible introduction of new tax policies in the mid-year budget review scheduled to be presented to parliament on Thursday, July 19.
The minister explained the move forms part of measures to shore up Ghana’s domestic revenue mobilization.
Ken Ofori-Atta said a package of tax policy measures in the mid-year budget review would be included in the mid-year review budget as part of efforts to ensure sustained funding for its key programmes.
But speaking to TV3’s Nuong Faalong, Prof. Bokpin said government does not need to introduce a new tax policy.
He argued that instead of introducing new taxes, the government should consider re-examining the tax exemptions that are given, especially to foreign investors.
“It is all about we examining our whole regime and agreement that we have entered into and probably we need to ask ourselves whether as a country we’re getting our fair share from the natural resources that God has given us because there is one thing having the natural resources”
He said even though Ghana has a lot of natural resources it does not get what it deserves by way of revenue because “We are desperate to attract investors”.
Professor Bokin also believes the private sector is already burdened with higher than average production costs and new taxes will strain their ability to drive growth.