The Country Managing Partner of Deloitte Ghana, Daniel Kwadwo Owusu has taken a swipe at government for what he describes as creating tax fatigue in the country.
According to him, expanding the tax net without taking cognisance of working to improve its base will affect negatively most businesses in the country.
Speaking to Joy Business at the launch of the 7th edition of the Ghana CEO Network Summit, Mr Owusu entreated government to include various economic activities to rake in more revenue.
Mr Owusu stated that the current economic and global challenges should push government to find more innovative solutions to addressing economic issues.
“I think we need to expand the tax base and not just increase the rate. When that is done it will create tax fatigue. We need to expand our tax base by increasing formalisation of our economy through digitalisation”.
“This will help boost internal revenue generation and reduce reliance on external borrowing and funding support”, he added.
He further indicated that the over-reliance on external funding support will be forestalled if successive governments invest borrowed funds from external creditors into various productive sectors of the economy.
He contends that government should desist from channelling borrowed funds to just expenditure, a move he believes is key to boosting internal revenue generation.
“Ensure that borrowed funds are invested in projects that will expand the productive capacity of our economy. This will also boost revenue generation and reduce reliance on external support”.
Presently, Ghana’s tax to Gross Domestic Product hovers around 14%, lower than the sub-Saharan African average of 19%.
Though the economy has expanded over the years, analysts believe there are numerous loopholes within the tax system, whilst government has given too many tax holidays to some foreign firms.
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