President of the Ghana Union of Traders Association (GUTA), Dr. Joseph Obeng, has emphasized the need for fair and equitable taxes for all citizens in Ghana.
Speaking at a national stakeholders forum on tax equity, Dr. Obeng raised concerns about the current taxation system carried out by the Ghana Revenue Authority (GRA), which, according to him, leads to non-compliance by some businesses due to perceived inequalities.
He specifically pointed out discrepancies in tax rates, with some businesses paying 22%, others 4%, and some being exempted based on the GH₵200,000 threshold.
“The consumer has the discretion of buying what he or she wants, the one paying 22% VAT and those paying 4% VAT stand at a disadvantage since their goods are likely to be priced high while those not paying any VAT at all sell at affordable prices and are able to make good sales,” he noted.
Dr Obeng said the government must implement policies to restructure the Value Added Tax (VAT) to ensure full compliance.
“To increase productivity, we must reduce taxes to compete with other developed countries,” he added.
Dr. Joseph Obeng emphasized the importance of widening the tax net to include artisans, carpenters, mechanics, tailors, electricians, and other businesses that were not previously paying taxes.
He argued that this expansion of the tax base would generate more revenue for national development. Dr. Obeng expressed concern that the current tax system was taxing a few businesses disproportionately, leading to lower overall revenue.
He urged the government to ensure fair and equitable taxation to encourage compliance and contribute to the country’s development.
“We need to find innovative ways of bringing a lot more people to comply with their tax obligations, failure to do that enforces discrimination,” he stated.
Dr. Alex Ampaabeng, Senior Programmes Officer at the International Budget Partnership (IBP), emphasized the need for a fair and equitable taxation system that includes a larger portion of the population. He expressed concern that the current system, where only a fraction of the population pays taxes, serves as a disincentive for others to comply.
Dr. Ampaabeng highlighted the low number of individuals in the informal sector paying taxes, emphasizing the importance of addressing this issue to achieve tax equity. He called on Civil Society Organizations (CSOs) to actively engage with key stakeholders and contribute to the development of fair taxation policies.
Additionally, he advocated for the government to explore effective digital taxation and policies that encompass online workers.
“Government should start with the riding apps like Uber, Bolt, and Yango to ensure payment of taxes and also to ensure safety from cybercrime,” he added.
The forum saw discussions on how different stakeholders could work harmoniously to promote tax equity in Ghana and enhance civil society relationships.