Remove ‘killer’ taxes – Minority demands

kwahuonlineradio July 30, 2019 0
Remove ‘killer’ taxes – Minority demands

The Minority in Parliament is demanding an immediate reversal in the new taxes announced by the Finance Minister Monday.

Ken
Ofori-Atta in his 2019 mid-year budget review proposed an increment in
Energy Sector levies and the Communication Service Tax.

Mr Ofori-Atta wants Parliament to approve a GHp 20 per litre for petrol and diesel and GHp 8 per kg for LPG.This pushes the prices of petrol and diesel up by some GHp 90 per gallon.

He also proposed a 3% increment in the Communication Services Tax, from 6% to 9%.

The
Minority, who had prior to the budget presentation warned against any
such increments, have criticised government for refusing to heed to
their caution.

“If
these increases (petrol, diesel and LPG) create frustration and
Ghanaians wish to vent through phone calls or on social media, the
Mid-year budget has made that expensive as well, following the
imposition of a 50% increase in the Communication Service Tax from 6% to
9%.

“These
measures will send shock waves through many households and businesses
as this will only further compound the excruciating hardships Ghanaians
are already going through,” Minority Spokesperson on Finance Ato Forson
said at a press conference Tuesday.

In
his view, the increments will add on to a raft of taxes imposed by
President Akufo-Addo despite his promise not to do so in opposition,
some of which he claimed to include a 5% backdoor increase in VAT
couched as NHIL and GETFund Levies.

Borrowing

The
NDC MPs have accused government of “cosmetically” posting a positive
primary balance for two consecutive years at a time when the public debt
has ballooned.

Mr. Ofori-Atta presented the mid-year budget review in Parliament Monday

Mr
Ato Forson is projecting that based on what he describes as
government’s appetite for borrowing, the public debt could reach some
¢220 billion by the end of the year, representing 65% of GDP.

“This
would mean that in three years, President Akufo-Addo would have added
GHS 100 billion to the public debt. We wish to stress that this only
represents what has been added since 2017. In all, President Akufo-Addo
has borrowed about ¢160 billion (not what is added to the public debt)
since 2017 with part of it used for debt reprofiling.

“The
public debt would exceed the projected ¢220 billion, once draw-down
begins for a number of loans approved by Parliament. This rapid increase
in the public debt level means that we have reached a point of debt
unsustainability, a fact confirmed by the World Bank Country Director,”
he added.

This
development, the Ajumako-Enyan-Esiam MP, indicated, is at variance with
what the President and his party told the people of Ghana in
opposition.

They created the impression that they could govern the country without borrowing and

that even if they borrowed at all, the funds would solely be channeled into capital investments, he said.

“After
adding ¢84 billion to the public debt, President Akufo-Addo cannot
point to any significant capital investments made over the last three
years. Almost all of the borrowed funds have gone into consumption
related expenditure.”

For
the Minority, the mid-year budget shows clearly the public finance is
in a dire state and the resort to additional tax measures is an
indication for what they believe are troubling times ahead.

The
populist policies adopted by President Akufo-Addo, in their view, have
come full cycle and are throwing all the gains made from the fiscal
consolidation prior to the coming into office of the NPP government, out
of gear.

“It
has become obvious that the NPP has no intention of keeping their
promises to Ghanaians when it comes to borrowing and the public debt,
the imposition taxes, fuel price adjustments and the resolution of the
general hardships facing the people.

“The
mid-year budget presented by the Finance Minister only offers gloom and
portend very difficult times for all Ghanaians. There is, therefore,
the need for the Akufo-Addo government to change course or they will
plunge the economy into much bigger challenges,” Mr Forson said.



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