By Magdalene Andoh
Finance Minister, Dr. Cassiel Ato Forson, says that the government has “stopped the bleeding” by addressing the misuse of tax refund funds, a move expected to save GH¢3.8 billion in 2025 alone.
Speaking in Parliament while presenting the government’s fiscal policy, Dr. Forson revealed that over the past eight years, GH¢29.11 billion had accrued to the Tax Refund Account.
However, only GH¢12.5 billion—just 43%—was actually used for tax refunds, with the remaining GH¢16.6 billion misapplied in violation of the Revenue Administration Act, 2016 (Act 915) and the Public Financial Management Act, 2016 (Act 921).
To curb this financial leakage, the government has decided to reduce the tax refund ceiling from 6% to 4% of total revenue, a measure that will yield significant savings.
“By reducing the ceiling on the tax refund from 6% to 4%, we will save GH¢3.8 billion,” Dr. Forson announced.
These savings, he noted, will help cover the revenue shortfall caused by the removal of certain taxes, including the controversial E-Levy, which accounted for GH¢1.9 billion, and the Betty Tax, which amounted to GH¢180 million.
“In 2025 alone, we have saved GH¢3.8 billion from just one source. This is enough to close the gap from the taxes we have removed,” Dr. Forson assured Parliament.
The Finance Minister indicated that this move is part of broader efforts to restore fiscal discipline and strengthen public financial management.
“To address concerns from well-meaning Ghanaians on how we are going to close the revenue shortfall as a result of the removal of selected taxes, the answer is—we have stopped the bleeding.”
The government’s commitment to financial accountability, he added, will ensure that public funds are used efficiently to drive economic growth and development.
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