A former Minister for Finance, Seth Terkper, says government’s plan for revenue generation has a deficit of four billion Ghana cedis.
Speaking to Francis Abban on the Morning Starr on Tuesday, Mr. Terkper stated that all levies including Electronic Transfer Levy (E-levy) does not make any significant amount to the revenue generation bucket.
Explaining how the levy collections work, the former Finance Minister stated that “everybody is paying the import VAT, it is only those who are registered who then proceed to use the Import VAT to offset the up put VAT that they are collecting and they get an import credit or refund.”
“Even that part of it has been blocked through making the NHIL and the GETFund, another impose decision. The non-registered businesses are already paying VAT because unless the law changes. Domestic VAT is by registration, import VAT is by clarifications of goods and commodities that are coming in,” Mr. Terkper stated.
Mr Terkper said Ghanaians are paying about 13 levies under the budget.
According to him, “we have ESLA levy on our books. Just go to the Appendix of the budget they are there. We have a pollution levy, we have the ESLA levies which include public lighting, road fund, energy and all those levies.”
Mr. Terkper further stated that imposing such taxes are rather distorting the tax regime.
“I am afraid, in fact we have a table that suggests that all of these taxes including the E-levy will not contribute more than five percent of GDP to the revenue.
“The mid-year review is reducing the revenue target from 100 billion to let’s say 96 billion so where is the boost in revenue? It is not happening, the mid-year review says that as result of poor performance till date. Even though the minister says that there is wind-fall from the oil revenue for which reason he is not asking for a supplementary budget. In the same vein he has reduced the total revenue from 100 billion to 96 billion.”
Source: Ghana/Starrfm.com.gh/103.5FM
