TAXATION IN RETROSPECT (2017 – 2021)LUXURY JETS IN THE MIST OF KILLER TAXES
Research from the Caucus for Mature Democrats confirm that taxes introduced by Nana Addo`s Government during its first term (2017 – 2020), have widely impoverished our people and thrown many out of job, plunging them into abject poverty. As I write drivers are desperately asking for the removal of fuel price increases.
Taxation imposed on citizens from 2017 to 2020, is as ff:
1. 3% VAT flat rate,
2. 5% increase in VAT by making the GETFUND levy and NHIL straight taxes,
3. 5% National Fiscal Stabilization levy (extended beyond expiring date of 2017),
4. First term (2017 – 2020) taxes that were imposed on Ghanaians, collected and later withdrawn ( luxury vehicle tax – GHC 1000 to GHc 2,500 – depending on engine capacity of vehicle ; 50% increase in Communication Service tax),
5. New taxes introduced in 2021 :
1% COVID-19 health recovery levy on the 3% VAT flat rate, making it 4% now,
6. 1% COVID -19 health recovery levy on the 2.5% National Health Insurance levy, making it 3.5% now.
7. 5% financial sector clean up recovery levy
8. New taxes imposed on fuel prices in 2021 : 20 pesewas Energy Sector Recovery Levy on every litre of diesel and petrol.
9. 10 pesewas Sanitation levy (“Borla”) tax on every litre of diesel and petrol,
10. 18 pesewas Energy Sector recovery levy on every kilogram of LPG.
11. Increases in existing taxes/levies on fuel prices from 2017 to date : 30% increases in Energy Sector levies (ESLA), extended beyond its original duration of 5 years to now 15 years.
12. About 11% increase in Special Petroleum Tax (from 41 pesewas to 46 pesewas) on every litre of diesel and petrol.
13. 200% increase in BOST MARGIN from 3% to 9%.
14. 67% increase in Fuel Marking Margin (from 3 pesewas to 5 pesewas) per litre of petrol and diesel.
15. 40% increase in Prise Stabilization and Recovery Levy on fuel products (from 10 pesewas and 12 pesewas on petrol and diesel respectively, to 14 and 16 pesewas on petrol and diesel respectively).
16. 25% increase in Primary Distribution Margin from 8 pesewas to 10 pesewas.
17. 36% increase in Unified Petroleum Prise Fund (UPPF) from 22 pesewas to 30 pesewas.
18. Increase in Road Fund Levy from 46 pesewas to 48 pesewas on every litre of diesel and petrol.
New 2022 Killer Taxes
In spite of above multi-taxes, Nana Addo has in the 2022 budget submitted to Parliament another series of taxes meant to increase the hardship on the people of Ghana.
Among them are 1.75% Bank Transfer tax and 1.75% internal remittance tax. 1.75% (digital) tax on all electronic transactions. 15% increases in fees from charges of Government. This affects all fees paid for Government services which include :
1. Company registration at Registrar General`s
2. Passport fees at the Passport office,
3. Food and Drugs Authority certificate fees,
4. Government Hospital fees,
5. Energy Commission fees,
6. Public University fees,
7. DVLA fees (food worthy fees, drivers license fees),
8. Immigration fees (work permit, residential permit
9. NCA fees / EPA fees / NPA fees / Birth and Death Registry fees /Airport fees etc..
All these fees will go up by 15%, when approved by Parliament. There will be reversal of 50% and 30% benchmark value discounts on 42 categories of imported goods and vehicles.
This simply means that the prices of vehicles, pharmaceuticals, including condoms, sugar, rice, aluminium roofing sheets, toilet-roll, facial tissue and towels, chocolate, palm-oil, mosquito-coils, ceramic tiles, aluminium products, Portland-cement, cement paper, water and soft-drinks, fruit-juice, tomato paste, Ketchup, furniture, toilet-soap, laundry bar-soap, lubricating-oil, alcoholic beverages, biscuits, pasta, spaghetti, noodles, macaroni, animal-products, textile and textile articles, electrical machinery and equipment among others, will now go up between 20% to 30% when approved by Parliament.
2021, Auditor General`s Report
The 2021 Auditor General`s report, sited many irregularities. These are Cash irregularities, Procurement irregularities, Pay-roll irregularities, Tax irregularities and Contract irregularities among others.
Cost of Irregularities
In 2016 the sum total cost of these irregularities added up to 718 million GHc. In 2020 the total cost of irregularities jumped to 12.8 billion. The names of the offenders are in the report. The question is why does the Government not collect the money from the offenders, instead of momo taxes affecting children and jobless?
The 12.8 billion plus the 40 billions of GHc paid for luxury jet flights and hotel bills for the past four years, by the President will be able to resource the economy that is still struggling for breathe in Intensive Care Unit (ICU).
Revenue and Expenditure
Interest payment of our debt amounts to 37.8 billion GHc. This in addition to statutory and other payments add up to 107.9 billion. Our total revenue from taxes however is 100.5 billion, which is less than what we have to pay. Calculations show we have nothing left for the so called anticipated projects. Economic experts suggest 2022 to 2024 budgets are going to be very repressive. Ghanaians will not be able to tighten their belts any longer.
The dichotomy of a non performing 77 year old President and his insatiable desire to remain in office is a mystery. Nana Addo must resign.
Dr E. K. Hayfod
Caucus for Mature Democrats