By Abraham Donkor, a Journalist
Taxes have and continue to be the building block of every society. Its usefulness to any development efforts can not be over-emphasized. But alas, as much as governments over the have tried to mobilize and raise revenues through taxes, some people and organizations have deliberately overlooked this civic responsibility with careless abandon. Many others have also fleeced the state coffers with unimaginable impunity through malfeasance, financial impropriety, expenditure without recourse to standards and procedures. These have significantly dealt a huge blow to development.
These uncontrolled leakages have led to more borrowing leading to heaping internal and external debt stock. This gloomy picture depicts someone who goes to the riverside to fetch water with a basket. The harder government tries to rake in more revenue and seal loopholes, the more waste are generated which makes us a laughing stock in international circles when we go for loans for amounts that could easily be generated internally. President Akufo-Addo in his inaugural speech on 7th January 2017 among others highlighted the need to generate more revenue internally to support his government’s Ghana Beyond Aid Agenda. At the Ghana Bar Association Conference held last year September, President Akufo-Addo made a worrisome observation.
”The record of lawyers paying taxes has been historically poor. It is an unfortunate, but most unpleasant fact that members of the profession in our country have not been known to have set a good example when it comes to paying taxes. They appear to think that members of the learned profession put them above complying with everyday civic duties, like paying taxes. It is embarrassing that lawyers are often at the top of the list of those who flout our tax laws and use their expertise to avoid paying taxes”.
Also, a recent exposé by the Ghana Revenue Authority suggests that about 60,000 professionals in the country do not pay taxes, including lawyers, accountants, doctors, surveyors, and architects. Is this not shameful and nauseating? These same people travel to other jurisdictions and obey all regulations within the tax regime. Do these professionals not even more than head potters, petty traders, and hawkers on the streets who pay daily tolls? How has the GRA reacted towards recovering these sums of money that can remove many schools under trees? Another source of revenue leakage is at the Ministries, Departments and Agencies.
The Auditor General’s report 2020 stated that GHC20 billion was stolen or misappropriated by MDA’s between 2017and 2019. On the accounts of District Assemblies, for instance, these infractions were cited. They include; cash irregularities, unaccounted payments, uncollected revenue, unrecovered salary, unidentified payments, unearned salaries among a host of there’s. One wonders if the Auditor General’s recommendations for recoveries, prosecution and other remedies are pursued with all seriousness to their logical conclusions. If they are, then some these recurring decimals will be minimal. But it does not appear so, as is being witnessed at the Public Accounts Committee sittings. At its sitting earlier this week the Committee directed Management of the Korle-Bu Teaching Hospital to refund over 123 thousand cedis within two weeks to the state coffers for items purchased that could not be accounted for. There were a number of infractions identified and directives issued for recovery. The Committee must not be swayed by a theatrical display of well-rehearsed remorseful sermons such as was seen previously, when a former public figure went to say,” To err is human: to forgive is divine. Ghana has been noted for granting tax exemptions to attract foreign direct investment. But it seems this overture is not really helping our cause. In a recent interview, the World Bank Country Director, Pierre Frank Laporte lamented the want on tax exemptions.
He opined that one of Ghana’s biggest problems is that it gives too many tax exemptions. He added that “empirical evidence has shown that these incentives, excessively in the long run don’t work” Very often, these foreign companies which are fronted by Ghanaians file for liquidation when the exemption period is benign, and transfer all profits to their origins. This nation till date has no legislation that requires such entities to re-invest some percentage of their profits into our economy. But they repatriate all their profits,a situation that also affects the performance of the cedi on the interbank market. Indeed we have the ability to mobilize enough revenue to foster development, but it will require the sealing and plucking of the wastage loopholes.
The Office of the Special Prosecutor must follow these activities keenly and take the necessary actions where they fall within his purview. Governments have tried to exorcise ghost names on our payrolls with minimal success. It is essential we sport the Ghana card initiative among others to drastically reduce some of these nuisances bedeviling our growth. The GRA also has a lot of work to do, having been mandated to collect and mobilize. All efforts must be marshaled to widen the proverbial tax net to ensure that all who fall within the category duly pay their taxes.
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