The Minority in Parliament says it feels vindicated in its prediction that the 2017 abolition of a slew of taxes will hurt government’s ability to fund its projects and programmes.
Deputy Minority leader James Avedzi called for a re-introduction of the taxes in the 2018 budget to be presented Wednesday.
Pro-government supporters on social media toasted in jubilation the March 2017 announcement that 11 taxes have been either abolished or reduced.
But eight months down the line, the Deputy Minority leader is asking “have you seen any change in prices?”
Picking examples, he argued that the abolition of the taxes on spare parts has failed to trigger a reduction in prices.
The removal of this tax, he said, has led to the spare part dealers “spreading that revenue in their pockets.”
For that reason, the intended beneficiaries of the abolished taxes were not reached.
Mr Avedzi also said the abolition of VAT on domestic airfares was unnecessary because the taxes were targeted at a particular class that could afford to pay.
According to him, government’s dwindling revenue kitty is further affected by a decreasing number of taxpayers.
“In 2015, 2.5 million people who pay tax dropped. In 2016, the number dropped further to two million…in 2017 the taxable population in Ghana is now 1.2 million”, he said.
Finance Minister, Ken Ofori-Atta
This drop should be the concern of the government he argued.
“Let’s look at the people who have been paying and are now not paying. Where are they hiding? What is their income?” he queried.
According to the Deputy Minority leader the failure to meet revenue targets affected government’s ability to meet its promises set out in the 2017 budget.
“The budget for 2017 has actually not been implemented. I can tell you that not more than 50% of allocations to MMDAs have not been disbursed because they didn’t get the money”.
This, he said, will mean the 2018 budget will only be a rehash of 2017 promises.
“It is going to contain nothing different from what we have in 2017 budget,” he said.
Mr Avedzi said the NDC MPs have been vindicated by their view that the estimates for revenue collection were too ambitious.
He expects the Finance minister to eat humble pie and admit to MPs, “we have realised there are some taxes that we have abolished which has affected revenue targets and for that matter, we are taking a second look at those taxes”