The most severe and punitive tax system in Ghanaian history, according to former Finance Minister Seth Terkper, is the one in place now.
Since 2017, the New Patriotic Party administration has been charged by the opposition National Democratic Congress with enacting more than fifty new taxes.
Ghanaians are furious because taxes are being imposed incessantly. The value-added tax (VAT) on residential electricity usage and the emissions levy are the two most recent taxes imposed on Ghanaians.
During a Monday interview, Mr. Terkper maintained that the nation’s current tax rates are unduly high, as Hanson Agyemang of Citi News noted. He clarified that such high rates might encourage people to look for ways to avoid paying these taxes.
“In my opinion, the current tax code is at its worst. We have never had a more harsh and terrible tax system than this one. And you will not ultimately end up earning as much money as you could from any punitive tax, he added.
He added, “But more importantly, taxpayers find ways to evade and avoid the tax when you begin to introduce punitive taxes.” Higher compliance and a more straightforward tax system are therefore desirable. Furthermore, the data backs up this assertion, demonstrating that, until recently, our tax-to-GDP ratio showed that 2015 was the highest year for revenue collection (measured in GDP percentage as opposed to nominal terms).
