Business News of Tuesday, 20 November 2018
The Finance Minister, Ken Ofori Atta, has attributed the shortfall in revenue despite new tax measures to the delay in enforcing the tax policies.
He is however anticipating that the government should be able to improve its revenue collection going forward with the rolling out of some of the tax measures in the 2019 budget.
The government has among others outlined major tax policies such as connecting Point of Sale devices to GRA’s systems, enforcing the excise tax stamp and VAT recalibration which it said should rake in some 1.8 billion cedis.
But this is yet to fully reflect in government’s revenue.
Mr. Ofori-Atta however believes the results should be achieved by next year.
Speaking on Citi TV’s current affairs talk show The Point of View, Mr. Ofori-Atta was upbeat the tax policies introduced in the Mid Year Budget Review in July 2018 will help improve revenue figures by end of year when the assessment is done.
According to him, the VAT recalibration is expected to rake in some revenue even though government is yet to undertake full assessment of the policy.
“Yes we decoupled the GETFund and the NHIL from the VAT and expected to rake in some revenue with a certain compliance measures.”
Mr. Ofori-Atta stated that government is hopeful of achieving its target with the use of technology.
“We have not been able to accomplish all of that in terms of the takeoff for the VAT decoupling. There was also some expectations of the electronic point of sale systems that have not yet gone into operations. My feeling is that there is a lot of learning that one has gone through this 22 months,” he said.
The Minister for Finance, Ken Ofori-Atta, after a Mid Year Budget Review in July 2018 said that government is expecting to make about GH¢ 500 million following the recalibration of VAT and its components.
According to him, although the new VAT structure will cost citizens more, its impact will not burden Ghanaians.
Ken Ofori-Atta said the government will ultimately be able to reduce inflation by 2% at the end of the year due to the move.
“Our analysis indicates that 5% more for the reconstruction will have a much lower burden, sharing between the manufacturer and the retailer. Our appreciation is that by the end of the year, we would have knocked off about 2% of inflation. So we are seeing a situation that we are able to get some of the money that we require, but the hard work of bringing inflation down, we’ll achieve that. I do get about half a billion because the levy runs through everything that you do,” Ken Ofori-Atta said.