Economist Urges Ruthless Enforcement of Tax Compliance to Address Revenue Shortfalls

Economist Courage Boti has urged Finance Minister Dr. Ato Forson to aggressively pursue tax compliance among businesses to address the government’s revenue shortfalls.

Mr. Boti argued that strengthening tax compliance efforts is crucial for generating sufficient revenue to support government expenditure without the need to introduce new taxes or increase existing ones.

“We have too many taxes in this country and there is no need to introduce a new one to raise the required revenue to support government’s expenditure,” he stated. “If we are heavy on compliance in this country, we can raise the required revenue to address the low tax to GDP ratio as well as meet the country’s rising expenditure.”

Mr. Boti’s comments follow the government’s decision to scrap the e-levy, betting tax, and the Covid-19 levy, which is expected to result in a significant revenue shortfall of approximately 10 billion cedis annually.

Finance Minister Dr. Forson has reiterated the government’s commitment to removing these taxes, despite concerns about the potential impact on government revenue.

The Ghana Revenue Authority (GRA) recently reported collecting 153 billion cedis in tax revenue in 2024, exceeding its target by 5.2%.

However, Mark Badu Aboagye, Chief Executive of the National Chamber of Commerce and Industry, cautioned against introducing new taxes, emphasizing the need for a fairer and more equitable tax system.

“We should understand that businesses want to pay their taxes, but not in its current form,” Mr. Aboagye stated. “For instances taxing firms before they start working.”