Check inefficiencies in tax system – Prof. Bokpin

A Professor of Finance at the University of Ghana, Prof. Godfred Alufar Bokpin, has advised government to check inefficiencies in the country’s tax system as it mobilises more revenue for development.

He said leakages in the system exceeded total revenue accrued to government but there could be more earnings when the loopholes were plugged.

Speaking on the sidelines of a SEND Ghana multi-stakeholder forum last Wednesday in Accra, Prof. Bokpin urged the government to focus on collecting more direct taxes instead of introducing indirect taxes that burdened the poor.

He noted there was “considerable room to collect more taxes without burdening the faithful few and without introducing fresh taxes” such as the Electronic Transaction Levy (E-levy).

He again called on the government to reconsider various tax exemptions granted foreign entities to the detriment of local businesses.

The forum on the “Commitment to Reducing Inequality (CRI) Index Report” was to discuss the state of inequality in Ghana and propose measures to address existing challenges.

The CRI report put together by Oxfam International, recommends that all governments “adopt strong anti-inequality policies on public services, tax and labour rights, to radically reduce the gap between rich and poor.”

The Economist, in a presentation, asserted that inequality in the country was at “crisis level” and affecting the ability of government to improve the wellbeing of Ghanaians.

He said that the worsening inequality gap was a security threat and steps must be taken to bridge the gap between the rich and the poor.

“The fact that a few Ghanaians are well to do but majority of Ghanaians go to bed not knowing where their next meal will come from makes it unsafe for all of us. Until every Ghanaian is okay, no Ghanaian is okay,” he said.

He noted society could become conducive for everyone if government checked public sector spending while improving the education, health and social protection sectors.

Citing connivance between tax officials and tax payers as contributing to revenue losses in the country, he further observed that government social intervention initiatives were one of many channels through which corruption was perpetuated.

He insisted that the growing poverty in the country is “fueling anxiety and causing people to cut corners,” hence the need for government to create equal and conducive environment for all.

Dr. George Domfe, Senior Research Fellow at the Centre for Social Policy Studies, University of Ghana also stressed the need to improve upon existing economic structures as interest payment on loans procured by government continued to impact the economy negatively.

He said the regressive nature of the country’s tax system must be addressed as the government focused on production instead of consumption to help attain the ‘Ghana Beyond Aid Agenda.’  

By Ernest Nutsugah