By: Franklin ASARE-DONKOH
A Professor of Economics at the University of Cape Coast (UCC), Prof. John Gatsi, says he is skeptical about the proposed tax amnesty the 2024 New Patriotic Party (NPP) flag bearer and Vice President Dr. Mahamudu Bawumia said he will implement when elected president of Ghana.
The Professor of Economics is of the opinion that this new tax measure will neither enhance tax payments nor address the challenges associated with tax payments.
Reacting to Dr. Bawumia’s address at the University of Professional Studies Accra (UPSA), Professor Gatsi argued that this measure does not address the primary challenge of tax collection in the country.
According to him, the main issue is the lack of commitment from citizens to voluntarily pay taxes, as they perceive no direct benefits.
Professor Gatsi suggested that the country should focus on enhancing public services, which he believes would motivate people to pay their taxes.
“Even if you give everybody tax amnesty, for which everybody should start afresh, that will not bring about any change because that is not the main problem of tax collection in the country.
The main problem is that people are not committed to the payment of taxes if they are supposed to voluntarily declare to pay taxes because it does not commensurate with the provision of public infrastructure for the people. Public transport is not the best. Access to public services is not the best for most people in Ghana; therefore, they don’t see why they should be paying taxes. Those are the issues that should be addressed,” he said.
The 2024 flagbearer of the NPP, during his address at the UPSA on Wednesday, February 7, 2024, outlined his vision for a new tax regime.
He promised to introduce a tax amnesty and a simple, citizen- and business-friendly flat tax regime if elected president.
This, he noted, would involve a flat tax based on a percentage of income for individuals and Small and Medium Enterprises (SMEs), which make up 98% of all businesses in Ghana.
The proposed system includes appropriate exemption thresholds to protect the poor and promises a simplified corporate tax system and VAT regime.
