70% of Ghanaians don't know how government uses tax revenue - Afrobarometer Report

The 2021 afrobarometer report released has indicated that majority of Ghanaians support taxation by the government provided it's used to solve the basic necessities of the citizens.

According to the report, majority of Ghanaians are willing to pay taxes to support development in the country.

But majority of Ghanaians say they find it difficult to know what taxes and fees they are supposed to pay and how the government uses tax revenues.

“The analysis finds that citizens are more supportive of taxation if they believe the government is doing a good job of delivering basic services. But many citizens also express mistrust of tax authorities and see widespread corruption among tax officials,” the report explains.

8 out of 10 Ghanaians, representing 79% believes that tax authorities have the right to collect taxes.

The report makes reference to the newly introduced taxes by the government of Ghana in the 2021 budget.

The new taxes are the 1% COVID-19 levy, 1% increase in National Health Insurance Levy, and 1% increase in flat VAT rate, as well as a 30 pesewa increase in fuel prices to take care of excess power capacity charges [20 pesewas] and Sanitation and Pollution Levy [10%].

Key Findings in Afrobarometer report

▪ A large majority (72%) are willing to pay more in taxes to help finance the country’s development from domestic resources rather than through external loans (Figure 2).

▪ Citizens who think the government is doing a good job of improving basic health services, addressing educational needs, providing water and sanitation services, maintaining roads and bridges, and providing a reliable supply of electricity are 6-8 percentage points more likely to endorse its right to collect taxes (Figure 3).

▪ But large majorities say it’s difficult to find out what taxes they’re supposed to pay (61%) and how the government uses tax revenues (70%) (Figure 4).

▪ Only four in 10 citizens (39%) say they trust the tax authorities “somewhat” or “a lot.” More than eight in 10 (84%) think at least “some” tax officials are corrupt, including one-third (34%) who think that “most” or “all” are involved in graft.