By Nathaniel Nartey
Facebook: Nathaniel Nartey
Twitter: @Annertey_Nartey
The Trade Union Congress, TUC’s call for the government to increase the tax rate on items such as tobacco, alcohol and beverages with high sugar content as a means of increasing revenue mobilization, appears to be catching up with the public, as some stakeholders have given support to the call.
The TUC in its proposals to the government ahead of the 2022 budget presentation in November, argued that increasing the tax rate on tobacco, alcohol and drinks with high sugar content, will discourage the consumption of these products that can cause health problems and help raise more revenue.
Executive Director of the African Center for Revenue Mobilization, Geoffrey Ocansey, described such taxes as “sin taxes” which need to be increased. He was sure the country can raise significant revenue which can be put to judicious use.
“I think for revenue generation we have always advocated that these sin taxes, that is taxes on products like tobacco, alcohol and sugar products are very necessary. These are products that have always affected our health budget. Government spends a lot of money to manage the non-communicable diseases from these products. So when you put taxes on these products you reduce the consumption, automatically decreasing the amount of money needed to manage these non-communicable diseases’’.
As part of the proposals TUC called for the merger of institutions which it considers to play duplicating roles. These include the Youth Employment Agency and NABCO. Mr. Ocansey said merging the two institutions will ensure that the government saves money on the administrative cost of running the two programmes separately.
“This is a very important call and I think there should be a national conference for young people to discuss what the government can do for them’’, he noted.
A Labour Analyst, Seth Abloso was optimistic about the proposal.
“Most of our revenue is also going into unauthorised increases that are in violation of the construction. So we are looking for money and the suggestion is that we should tax tobacco, alcohol and sugars. I support it but, I say it’s not enough and the TUC itself needs to look at other areas that have a drain on the economy”.
Meanwhile, Executive Director of the Africa Center for Health Policy Analysis, Dr. Thomas Anabah, has cast doubt on the feasibility of increasing the tax rate on beverages with high alcohol content, despite supporting the tax on tobacco and alcohol.
This is because an increase in the tax rate on beverages with high sugar content will have dire consequences on the poor, according to Mr. Anabah.
