2022 budget: Replace ‘nuisance’ taxes with productive levies – Prof. Quartey
Ahead of the presentation of the 2022 budget, the Director of the Institute of Statistical Social and Economic Research (ISSER), Professor Peter Quartey, is calling for the scrapping of some nuisance taxes introduced in the previous budget.
Professor Peter Quartey believes some of the taxes introduced did not live up to expectations with respect to revenue mobilization and should be scrapped.
He further advised that if new taxes are to be introduced, they must be substituted with the unproductive ones earlier introduced.
“If new taxes would be introduced, there is the need to evaluate current taxes to find out those that are not performing or what we call nuisance taxes. They should be taken out or replaced with something else. But if you add more, there can be too much stress on the private sector and individuals, and that could lead to tax avoidance and tax evasion.”
“The sanitation revenue, for instance, the second quarter 2021 figures show that they are not yielding much. It is the COVID-19 health levy as well as the financial sector levy that is racking in the revenue. The sanitation levy for instance is not bringing in much. So, it’s either we review these taxes to see whether they are being efficient, or we are rather spending more money collecting this little revenue, or we scrap them and replace them with something that will bring in more revenue to the system,” he added.
Professor Peter Quartey spoke to the media on the sidelines of the launch of the State of the Ghanaian Economy Report (SGER) 2020 and Review of 2021 Third Quarter Economic Performance.
Some new taxes were introduced in the 2021 fiscal year, while some already existing ones were adjusted upwards as part of plans towards the economic recovery of the country.
The government, as part of its efforts to revive the economy, introduced the COVID-19 Health Recovery Levy Act, 2021, Financial Sector Recovery Levy Act, 2021 among others.
Some Civil Society Organisations raised concerns over some of these taxes, arguing that they could stifle growth as businesses continue to grapple with the impact of the pandemic.
source: citinews
