Former Finance Minister, Seth Terkper is warning of dire repercussions on Ghana’s economy given the reduction of taxes by the Akufo-Add led government.
According to him, the reduction will only encourage smuggling and deprive government of needed taxes for development.
His comment comes after Finance Minister, Ken Ofori-Atta while delivering the 2017 Budget in Parliament announced government's decision to abolish eight taxes and reduce four others, many of which were set by the previous government.
The taxes the Minister listed to be abolished and reduced include;
(a) Abolish one percent special import levy,
(b) Abolish 17.5 VAT on financial services
(c) Abolish 17.5% VAT on selected imported medicines
(d) Initiate steps to remove import duties on raw materials and machinery
(e) Abolish 17.5 VAT on domestic airline tickets
(f) Abolish 5% VAT on real estates
(g) Abolish excise duty on petroleum
(h) Reduce special petroleum tax rate from 17.5% to 15%
(i) Abolish duties on importation of spare parts.
(j) Abolish levies imposed on Kayayei's by local authorities
(k) Replace the 17.5 VAT on Ghana Stock Exchange (GSE) traders to a flat rate of 3.5 percent
(l) Reduce National Electrification levy
According to Mr Ofori-Atta, many of the taxes were nuisance taxes, and hence the removal will ease the difficulties imposed on Ghanaians.
But Former Finance Minister in an interview with Joy News said the tax cuts is a recipe for disaster.
He explained that tax free spare parts importation is only going to deprive Ghana of revenues.
Seth Terper urged government to weigh the pros and cons before implementing the reduction.
Source: adomonline.com
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What kind of logical reasoning is this Mr Tekper, how can reduction in taxes encourage smuggling? to where , outside Ghana, your system of economic management is outdated, please don't bring yourself, you were finance minister, when Ghana went for IMF bailouts, coz of the way the economy was mismanaged, excessive borrowing and corruption during ur tenure
Mr. Terkpe please allow the economist to manage the economy for us and keep your thoughts to your self ok. You had the country for 4years and the only thing you could do was to increase taxes and increase taxes and increase taxes. What did you and your ***barred word*** government used our tax money for.
we like it. if smuggling will make Ghana work again. what's did you did to help Ghana. learn from this people. Kwabena duffour. Osafo marfo and other and leave us alone
Is it not when the duties and taxes are high that the smugglers will be active to dodge them?. That is logic lesson no.1 for Terkper and NDC!
Seth Keeper can't think far. It's not gis fault
Abolishing of taxes encouraged dumping
So what. You had your chance and blew it. This is our time and we will give Nana more money to run the the economy so ***barred word***.
How? We don't produce spare parts in Ghana on a mass scale so how is it going to encourage smuggling? I don't get?
I don't condone smuggling, but may ask, when the goods are smuggled out of the country, where will the smugglers send the money? Is Tekper trying to tell us the only high tax rate can stop smuggling? Ghana is still crying.
@nii. Yes oo. I don't understand the smuggling aspect. May smuggling to Togo? Terkper, you like tax too much.