Govt asked to scrape allowance for teacher, nursing trainees

Mr Appiah Kusi Adomako (left) with Mr Isaac Yaw Obeng answering questions from the media

Mr Appiah Kusi Adomako (left) with Mr Isaac Yaw Obeng answering questions from the media

Consumer Unity and Trust Society (CUTS) International, an Accra based Centre for Policy and Research, has urged the government to scrape the allowances for teacher and nursing trainees, and channel the resources into the payment of their boarding and lodging fees.

The group also said it did not understand why government should continue to pay allowances to the students while in school, and fail to employ them after completion of their education due to the lack of funds.

The Executive Director of the centre, Mr. Appiah Kusi Adomako, made the call when addressing journalists on the CUTS input into the 2019 Budget Statement and Economic Policy of government submitted to the Ministry of Finance, in Accra.

He asked government to make taxation and tax collection more progressive through increasing the proportion of taxes coming from personal and corporate income tax.

This, Mr Adomako called on government to reclassify the Pay As You Earn (PAYE) taxes as a means of ensuring even distribution of the tax burden among those found within those brackets.

“We propose that those earning GH₵10,000 be rather taxed 30 per cent instead of the current 35 percent, while those earning GH₵14,000 per a month be taxed 35 per cent and finally, income exceeding GH₵18,000 a month be taxed at 38 per cent,” he said.

Mr Adomako said in order for government to be able to undertake its programmes while reducing budget deficit, it was important that it invest more in the operations of the Ghana Revenue Authority.

He said that the ability of the country to rake in more revenue would depend on how effectively the GRA was resourced, stressing that, “Deployment of technology and proper harnessing of data can help GRA close in on tax evaders.”

Mr Adomako said there was the need for the country to formalise the informal artisanal sector to expand the tax net.

He explained that about 95 per cent of houses in the country were built by people in the informal sector of the economy; however, their incomes were not taxed because the GRA had no data on such people.

“To help ensure that informal artisans pay at least 7.5per cent taxes on their services, the burden of compliance must be shared between the property owner and the artisan,” Mr Adomako said.

He asked government to review the tax exemption system, adding that multi-nationals operating in the country should not be given tax exemptions.

“Tax exemptions should not be given to multi-national firms in a sector where there are existing local players or competitors. This is to ensure competition and level playing field. Tax exemption should be linked to sustainable job creation and must past the SMART test,” Mr Adomako added.

By Cliff Ekuful & David Takyi

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