Plans to introduce a digitised system were announced by vice president Mahamudu Bawumia in early November. Bawumia said that broadening the tax net is “imperative” and said that a new mobile tax filing application is now ready for use.
The plan has the potential for “immense positive outcomes”, says Courage Kingsley Martey, senior economist at Databank Group in Accra. “We believe issues of corruption in the tax system, evading the tax net and under-declaration of taxable income could be significantly reduced if the system is digitized.”
Increased revenue collection is crucial to improving Ghana’s public finances, Martey argues. Ghana’s revenue-to-GDP ratio hovers around 14%, about half of what the revenue benchmark required for a lower-middle-income country, he says. “Ghana’s revenue base is not wide enough for direct taxes and even for indirect taxes.”
- Debt-interest payments account
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