Social Justice Organisation ActionAid Ghana is sounding the clarion call on government to as a matter of urgency institute measures to address the devastating impact of Ghana’s recent IMF induced taxation burden on women, particularly in low income homes and informal employment.
Ghana’s return to the International Monetary Fund (IMF) for the 17th time in May 2023 for a $3 billion, 36-month Extended Credit Facility arrangement to help Ghana’s economic recovery has left in its wake, adverse impacts on women in diverse sectors.
In a new report set to be released on November 22, ActionAid Ghana seeks to address a critical gap in the country’s tax policies, which often ignores gender disparities, thereby inadvertently worsening economic inequality. The upcoming report, titled “Impact of IMF Policies on Tax Systems and Gender Equality in Ghana,” highlights how IMF-backed tax reforms, despite being aimed at boosting revenue and ensuring economic stability, engender disproportionately adverse effects on Ghanaian women.
The report provides a detailed analysis, revealing that after Ghana’s engagement with the IMF, mainly through fiscal reform programs, tax policies have emphasised revenue generation. However, ActionAid Ghana’s findings indicate that the IMF’s reliance on indirect taxation, such as Value Added Tax (VAT), has a regressive effect. This type of taxation disproportionately affects women, especially those in lower-income households and informal employment, exposing a significant flaw in IMF’s approach to gender considerations.
Key Findings of the Report:
- IMF tax policies in Ghana lean heavily on indirect taxes, such as VAT, which places a higher financial burden on women than men.
- Women, particularly those with lower incomes and fewer assets, face greater economic hardship due to the VAT-heavy system, exacerbating their financial insecurity and hindering economic participation.
- The IMF’s focus on macroeconomic stability has overshadowed equity concerns, often resulting in tax policies that unintentionally worsen gender inequality.
With the successful enactment of the Affirmative Action Law, ActionAid Ghana is calling for concrete measures to promote gender equality in tax systems:
- Gender-Disaggregated Data Collection:
Implement robust data collection processes to assess the different impacts of tax policies on men and women, enabling targeted policy adjustments. - Support for Women in the Informal Sector: To enhance women’s economic participation, introduce tax relief measures for low-income earners, particularly in the informal sector, where women are overrepresented.
- Collaborate with Gender-Focused Organizations: Partner with local and international gender-focused organisations to align IMF policies and Ghana’s gender equity goals.
- Gender-Responsive Budgeting: Allocate resources specifically to address gender disparities, fostering economic justice and empowering women.
- Transparency and Accountability in Tax Reforms: Ensure Open
open and transparent discussions on the gendered impacts of tax reforms to align policies with the country’s social equity goals.
As a social justice organisation, ActionAid Ghana is emphasizing that without gender-sensitive economic policies, IMF-supported tax reforms risk deepening existing social inequalities. As Ghana continues to partner with the IMF on financial strategies, prioritising gender equity is crucial. ActionAid Ghana advocates for a balanced approach that values macroeconomic stability and social fairness, contributing to a more inclusive economy where everyone can prosper, regardless of gender.
Source: Ghana/Starrfm.com.gh/103.5FM/Joshua Kodjo Mensah
