Varsity Commends Gov’t For Imf Move

The Pentecost University College Graduate School (PUCGS), has described the approach of the government to obtain financial support from the International Monetary Fund (IMF) to stabilise the economy as a good one

PUCGS which gives thumps up for the move at a programme dubbed ‘Mid Year Review of the 2014 Budget statement’ in Accra said it was of the view that the approach of the government of Ghana to obtain financial support from the IMF was a good approach to help restore stability in the economy through prudent public financial management under the watch of the IMF.

PUCGS, as part of its contribution towards national development, has instituted a programme to create awareness of tax issues in the country.

A statement issued at the end of the programme stressed the need for the government to put preventive measures in place to forestall any future occurrence of the difficulties that confronted the economy.

The statement also catalogued a number of recommendations and interventions that the government must consider going forward.

It cited the reduction of the number of projects in the budget as an important step that the government must take.

It said the 2014 budget, had too many projects, which by end of the budget cycle remain uncompleted or unstarted.

“It is advised that the government moves towards planning programme budgeting system so that in the face of resource constraint, the government can prioritise projects by selecting those with higher socio-economic impact that can be adequately completed in good time,” it said.

It called for tax rate reductions to encourage voluntary compliance adding that the tax burden in Ghana seems to be very high.

This it said this phenomenon adversely impacts economic growth as the disposable income of tax payers was significantly reduced.

The statement recommended that leakages in the tax system should also be plugged rather than resorting to tax rate increases.

“There is the need to enhance tax incentives to curb tax evasion and abusive tax practices. The government must adopt cost effective and humane measures to enhance willingness to honour tax obligations, especially at Ghana’s ports and bonded warehouses to ensure more resource mobilisation. Additionally, more training must be provided to the Ghana Revenue Authority (GRA) staff to prevent loss of revenue from dubious and fraudulent transfer pricing practices by multinational organisations,” it said.

The government the statement said must endeavour to reduce wastages in the system and concentrate on few but essential projects for economic use of tax payers’ money.

“There is also the need to improve government’s revenue estimation techniques to reduce the effects of revenue shortfalls as a result of low tax base and high tax rates,” it said.

On deficit financing management it said deficit financing, in itself, was not necessarily bad, but any borrowing that the government undertakes must be done with clearly defined objectives.

The funds used it said must also be targeted towards very clear socio-economic goals for the benefit of the nation.

“We should also avoid locking up short-term facilities into long-term gestation projects,” the statement said.

“The recent supplementary budget must be expended on specific projects which have tendency to drive economic growth and create sustainable jobs. Also, the government must improve its anti-corruption drive to increase the current low levels of confidence in the government and improve its policy credibility,” it said.

The statement also urged the government to move to target key and prioritised projects that contribute to socio-economic growth of the country with adequate planning.

Prof. J.B.K. Aheto and Prof. Cletus Dordunoo, both network panel members of PUCGS served as chairman and speaker, respectively.

Messrs Akwasi Safo Brempong and Daniel Amassah Kotey, Master of Commerce in Taxation students served as discussants on the panel.

By Times Reporter

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