Budget 2022: Government to cut all wasteful tax exemptions

The Finance Minister, Ken Ofori-Atta, has indicated that government will trim down wasteful tax exemptions to ensure the country gains significant returns from companies enjoying tax exemptions.

Finance Minister, Ken Ofori-Atta

He made the announcement during the presentation of the 2022 budget to Parliament on Wednesday, November 17, 2021.

According to the Minister, Ghana is losing about 5% its Gross Domestic Product (GDP) annually due to excesses in taxes of companies operating in the free zones enclave.

Mr. Ofori-Atta reiterated government’s commitment to put in place measures to handle wasteful tax exemptions, stating that government, through the Exemptions Bill which will be laid in the house in 2022, will trim down wasteful tax exemptions to ensure the country gains significant returns from companies enjoying tax exemptions.

We wish to reiterate that we are in challenging times, which require radical measures; so, let us embrace these new policies to enable the government to address the fundamental issues affecting the economy to ensure that our nation continues to maintain its position,” he said.

The Finance Minister also made a dire revelation when he said less than 10% of Ghana’s 30.8 million population pay direct taxes.

Only 2,364,348 are bearing the burden of the entire population as taxpayers as of August 2021,” he outlined in his budget presentation in Parliament.

This figure is informed by the 2021 Population and Housing Census.

The Minister juxtaposed this figure with the registered voter population of 17 million, which gives an indication of the number of Ghanaians aged 18 and over.

This is a trend that needs to be addressed “to build a more equitable society,” Mr. Ofori-Atta stressed.

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