Tax cuts will aid economic growth

Mr Ken Ofori Atta, Minister designate for FinanceThe Finance Minister-designate, Kenneth Nana Yaw Ofori-Atta, has said reducing and scraping some taxes will serve as a stimulus to the growth of the Ghanaian economy than a dip in resources, as some people may see it.

In his view, scraping and reducing some taxes, as promised by the New Patriotic Party (NPP) in its electioneering manifesto, will lead to the expansion of the private sector which will in turn create jobs and bring in more people into the tax bracket.

The opposition National Democratic Congress (NDC) during the 2016 electioneering campaign, hit at the New Patriotic Party (NPP) for proposing to cut tax while embarking on mega projects.

According to the NDC, the proposal of the NPP to scrap and cut taxes was inconsistent with its promise to embark on mouthwatering projects including a factory per district, a dam per village in northern Ghana and one million dollars per constituency yearly arguing tax cuts will lead to a shrink in resources.

But appearing before the Appointments Committee of Parliament on Friday, Mr. Ofori-Atta said removing some of the taxes and reducing the others will lead to the expansion of the private sector.

There is too much wastage in the system and blocking such leakages in the financial administration of the country would save the country lots of money, he observed.
He said his administration would focus on being financially disciplined, protect the public purse and account for every cedi that would be used on behalf of the people.

New taxes, he said, may be introduced to maximise government’s financial ability to fulfill its electioneering campaigns but failed to put a timeframe on the removal of some taxes only to say that “there is huge attempt to fulfill these promises”.

To him, it was important government spending commensurated with its inflows to end the cycle of annual budget deficit. “If we continue to spend more than we earn, we will continue to have this sort of economy.

“The challenge is how we restrain our expenditure, ensure revenue come in and ensure we have value for money,” he noted.

“We will stop sucking money out of the system which makes it difficult for private sector to expand because once interest rate goes down, we will see an economy that is more stable and expanded enough for private sector to take its role,” he stated.

The minister-designate said as a government, alleviating the ‘suffering’ of the citizenry remain a key commitment adding that rebalancing the economy and addressing the structural architecture of the economy was critical in attaining the economic transformation.

He said doing this would require the formalisation of the economy and that would be addressed by a proper identification systems to track all businesses hinting that a national data would be prepared under the National Identification Authority within the first 18 months of the government.

Reassuring of some of the campaign promises, Mr. Ofori-Atta said 50 million Cedis would be allocated to the yet to be established Zongo Development Fund and a real commitment to the restoration of the Teacher and Nursing Trainee allowances.

Asked what legacy he would want to live as a Finance Minister if approved by Parliament, Ken Ofori Atta said: “I would like to leave the ministry with a global standard, treasury department, a risk department and a way in which every minute, we will know where our money, what our money is doing for us and how our money is being spent.”

By Julius Yao Petetsi

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