The first in a series of five Focus Group Discussions on fiscal policies to address inequalities in the tax burden in Ghana has taken place in Accra.


The Discussions,  which are being organized by the Consumer Protection and Trust Society (CUTS) Accra, a Centre for Policy and Research, in collaboration with Oxfam, aim to address the over exposure of the poor to indirect taxes, help maximize revenue from property taxes and to increase spending in the education and health sectors.


In an address to open the Discussions, yesterday, Mr Appiah Kusi Adomako, Centre Co-ordinatior, CUTS International, Accra, noted that Ghana relied heavily (55%) on indirect taxes such as Value Added Tax (VAT) or Customs and Excise duties .


Mr Adomako described this form of taxation as regressive because the poor spent a larger percentage of their meagre incomes on these goods. 


He said overreliance on VAT could also make tax systems more regressive in their gender impacts, as women and the poor usually bore greater responsibility for caring for their families and, therefore, spent a greater proportion of their income on goods and services.


Furthermore, he said, Ghana had not done well in raising revenue from property taxes due to the overreliance by the Metropolitan, Municipal and District Assemblies (MMDAs) on the District Assemblies Common Fund (DACF) as well as the inherent challenges in collecting the taxes from property owners.


Mr Adomako said as the country embarked on “Ghana Beyond Aid” policy, one area that the government and MMDAs could explore to fund education, healthcare, roads and other basic social services was property taxes.


Among the recommendations made at the workshop are the removal of special petroleum levy, payment of corporate tax by churches and a halt to the tax holidays enjoyed by foreign multinational companies.


The Forum also stressed the need for the Ghana Revenue Authority to invest in data systems in order to stop fraudulent and corrupt practices in tax collection.


In the opinion of the Forum, loopholes in tax collection could be sealed with effective monitoring and the application of more efficient ways of tax collection.


The Forum identified the lack of capacity on the part of the District Assemblies  to efficiently collect taxes, adding, however, that the introduction of electronic payments and digital address systems could boost tax collection.


The forum called for a standard form of assessment of properties to facilitate the payment of property rate, adding that rather than lodge property rate into the consolidated Fund, the tax should be used to deliver social services.



Source: ISD (G.D. Zaney)