Economist and lecturer at the University of Ghana Business School (UGBS), Dr. Patrick Opoku Asuming has charged the government to hasten efforts at leveraging its digitization agenda to plug any revenue and expenditure loopholes while focusing on property taxation and tax exemptions to raise more revenue.
The remarks follow the downgrades of Ghana’s credit rating by Fitch last month and by Moody’s last week.
While Fitch downgraded Ghana to B negative with a negative outlook, rating agency, Moody’s Investor Services on Friday, February 4, 2022, downgraded Ghana’s long-term issuer and senior unsecured debt ratings to Caa1 from B3 and changed the outlook to stable from negative.
Speaking to Citi Business News, Dr. Asuming noted that urgent action is needed on both the expenditure and revenue fronts to address the challenges outlined by the rating agencies.
“On the expenditure side, I’ve always felt that government can use its digitization drive to plug the loopholes such that everyone will be captured in the system. I think that hasn’t progressed as fast as possible. If you go back to the budget, the government itself mentions two other important things, one being the property taxes, and two, addressing the issue with the exemptions.”
“In these difficult times when we need to collect every penny that we can get, I think we have to look seriously at property taxes as the properties are fixed and have been numbered. As for the exemptions, I still don’t understand why at this time we still haven’t addressed the issues about the exemptions. When we were in the last IMF program, it was a big part of the discussion, for the government not to give huge exemptions to companies that were able to pay the tax,” he added.