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Granting amnesty won’t improve challenges in tax collection – Prof Gatsi tells Bawumia

Economy & Investments Granting amnesty wont improve challenges in tax collection – Prof Gatsi tells Bawumia
FEB 9, 2024 LISTEN

John Gatsi, a Professor of Economics at the University of Cape Coast (UCC), is sceptical about the proposed tax amnesty by Vice President Alhaji Dr. Mahamudu Bawumia.

He believes that this measure will neither enhance tax payments nor address the challenges associated with tax payment.

Dr. Bawumia, the flagbearer of the New Patriotic Party, has promised to introduce a tax amnesty and a simple, citizen- and business-friendly flat tax regime if elected president.

During his address at the University of Professional Studies, Accra, he outlined his vision for a new tax regime.

This would involve a flat tax based on a percentage of income for individuals and Small and Medium Enterprises (SMEs), which make up 98% of all businesses in Ghana.

The proposed system includes appropriate exemption thresholds to protect the poor and promises a simplified corporate tax system and VAT regime.

However, Professor Gatsi argues that this measure does not address the primary challenge of tax collection in the country.

He identifies the main issue as a lack of commitment from citizens to voluntarily pay taxes, as they perceive no direct benefits.

In an interview with Umaru Sanda Amadu on Eyewitness News, Professor Gatsi suggested that the country should focus on enhancing public services.

He believes that this would motivate people to pay their taxes.

“Even if you give everybody tax amnesty for which everybody should start afresh, that will not bring about any change because that is not the main problem of tax collection in the country.”

“The main problem is that people are not committed to the payment of taxes if they are supposed to voluntarily declare to pay taxes because it does not commensurate with the provision of public infrastructure for the people. Public transport is not the best. Access to public services is not the best for most people in Ghana, therefore they don’t see why they should be paying taxes. Those are the issues that should be addressed,” he said.

—citinewsroom

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