An economist and Professor with the University of Ghana Business School, Professor Godfred Bokpin is urging government to intensify its tax compliance efforts in its quest to increase revenue mobilization in the country.
According to him, this will enable government generate more revenue and enable it raise funds for key infrastructure projects thereby leading to a reduction in the need for loans which will eventually increase government debt.
Already, the International Monetary Fund (IMF) Staff Mission to Ghana, has charged government to without delay implement the needed measures that will lead to a reduction in government’s overall debt as well as its debt servicing burden.
Speaking at the maiden edition of The Money Summit in Accra, he noted that though government has implemented some measures to improve revenue mobilization, more need to done to scale-up collection in Ghana without burdening the ordinary Ghanaian.
“When you look at Ghana’s tax efforts and you even compare that to our peers, you realise that there is room for improvement. There is space to scale-up collection in Ghana without burdening the faithful few because we cannot use the level of informality to explain why we cannot collect more taxes. because our peers with similar informalities are doing between 18% and 20% of GDP and Ghana is doing below 13%.
So, if we were to scale up to our peers, and do even 18%, that gap is huge enough and we can actually close some of the challenges that we are talking about. So, going forward I think now that elections are over, government will have to be aggressive a bit in terms of greater tax compliance and employing greater digitization in revenue administration mobilization. Because where the debt stock is, the associated servicing costs and all of that would have implications for the sustainability of the financial sector,” he said.
The maiden edition of the Money Summit was organized by the Business and Financial Times in collaboration with the (BoG), Ghana Association of Bankers (GAB), Ghana Stock Exchange (GSE) and Ghana Insurers Association (GIA)
It was under the theme: The Role of the Financial Sector in Post-Pandemic Recovery.
The event which covered every aspect of the financial sector – banking, insurance, pensions, capital market and asset management – saw seasoned industry players and policymakers deliberate on how to position the sector to lead in the post pandemic recovery efforts.