Michael Boateng, Associate Director of Tax Advisory Service at global firm KPMG, has raised concerns about the overwhelming tax burden placed on businesses in Ghana, describing it as excessive. Boateng further noted that many medium- and small-scale enterprises (MSMEs) face the issue of double taxation due to a lack of tax knowledge and inadequate record-keeping practices. Despite diligently filing annual returns, these businesses often struggle to provide detailed operational and transaction information when visited by tax officials, leading to additional and unwarranted charges.
During the Ghana National Chamber of Commerce and Industry’s (GNCCI) dialogue series in Accra, Boateng emphasized the importance of businesses seeking expert advice to navigate tax-related matters, reduce costs, and ensure proper record-keeping. However, he also stressed that the Ghana Revenue Authority (GRA) should take a more proactive role in sensitizing taxpayers.
Boateng highlighted instances where tax audits revealed that businesses were paying taxes they were not obligated to, either because they fell outside the relevant tax category or had already made payments in a different form. The absence of proper records and tax knowledge among these businesses exacerbates their compliance challenges.
Additionally, Professor Peter Quartey, Director of the Institute of Statistical Social and Economic Research (ISSER) at the University of Ghana, spoke on the topic of understanding the International Monetary Fund (IMF) program and its potential risks and opportunities. Quartey urged businesses to adopt cost-cutting measures, establish partnerships, improve efficiency, and explore alternative revenue streams to mitigate challenges.
Expressing concerns over the current economic situation, Clement Osei-Amoako, National President of GNCCI, highlighted the adverse impact on investor confidence, rising inflation, a weak local currency, high policy rates leading to expensive borrowing, unsustainable debt levels, and impaired economic growth. The Chamber called on the government to collaborate with the central bank to find innovative solutions for addressing high inflation, facilitating business expansion, and aiding post-COVID-19 recovery.
Furthermore, the GNCCI urged the government to focus on improving tax administration efficiency and expanding the tax net, rather than introducing new taxes or increasing tax rates. Osei-Amoako emphasized the need for a thorough analysis of sectoral contributions to GDP, cautioning against overemphasis on the reported 4.2 percent growth in the first quarter of 2023. He warned that while the public sector may be expanding, the contraction of the industrial sector poses risks to the sustainable growth of the economy.
Norvanreport