Lower growth potentials to dampen Ghana’s 2017 revenue

Ghana stood to miss out on its revenue targets for 2017 due to lower growth potentials in the economy, an economist projected on Tuesday.

Olabode Augusto told the media during the Seminar on Ghana’s Macro-economic Landscape that the country needed a competitive taxation strategy to run the economy.

“The revenue projections, especially the tax revenue projections, are a bit ambitious because the growth rate in the economy of Ghana has slowed down considerably and what we see is that when economies slow down, the ability of governments to generate tax revenue also slows down,” he said.

The government of President Nana Akufo-Addo targets a 34-percent increase in tax revenue in 2017, relative to the 2016 revenue with a 34.8 billion cedis or 7.9 billion U.S. dollars revenue target, while at the same time seeking to depart from taxation-focus to production-focus in economic management.

“No country can depart from taxation because the bulk of government revenue that is sustainable is tax revenue. I also will enjoin the country to use user-fees; those who use government services should pay. But, of course, we can have subsidies but subsidies must be targeted at the poor and weak in society,” the economist said.

Augusto, a former partner in PriceWaterHouse Coopers (PWC) and a former Director General for Budgeting under the government of Olusegun Obasanjo in Nigeria, was however optimistic about Ghana’s prospects.

“A lot can work for Ghana. In fact, it is one of the countries that we are very bullish about in sub-Saharan Africa, and it starts from the political stability that we have in this country. It’s the beacon of democracy in sub-Saharan Africa,” Augusto said.

“If we leverage that and work better with the private sector, I believe that the country will achieve long-term sustainable growth, strong growth for that matter, because government can not do everything,” he maintained.

Olusola Ogundimu, Managing Director of Integrated Legal Consultants, facilitators of the economic seminar, stressed the need for knowledge for market players in the era of exchange rate volatility. Enditem

Source: Xinhua/NewsGhana.com.gh

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