Finance Minister Ken Ofori-Atta has hinted of government’s plan to review the country’s existing tax systems to introduce more private sector-led solutions in the revenue mobilisation efforts ahead of the 2020 budget presentation next week.
Mr. Ofori-Atta’s comment follows the inability of the Ghana Revenue Authority (GRA) to meets its domestic revenue mobilisation targets in the last four years.
In an interview with Citi FM, the Finance Minister said countries do not grow because of customs revenue, which is a significant chunk of domestic revenue.
“We really need to disabuse ourselves of that; make it efficient nonetheless but really look at corporate taxation and spreading the net in a more effective way. We look to reviewing all of our tax systems in 2020,” Mr. Ofori-Atta said.
The government, in recent times, responded to the revenue shortfalls with a number of tax reforms as well as institutional reforms at the tax collecting authority but the measures could not prevent a shortfall of GHS5 billion as at July 2019.
According to Mr. Ofori-Atta, come 2020, the government will move away from the piecemeal approach to the reforms and conduct holistic reforms that would place a premium on the role played by private sector-led initiatives in mobilising revenue.
“We have been responding, changing different handles to suit the moment. I think it is time to look at the whole infrastructure of taxation especially as we are now looking to private sector solutions to the transformation,” the Finance Minister revealed.
Private sector initiatives
The Ghana Revenue Authority last year secured the services of Mckinsey Group, an international consulting firm, to offer its expertise to help boost revenue generation.
The Group’s engagement was to help change GRA’s systems to be comparable to the best in revenue administration in the world through simplified processes and innovation.
The Group was expected to train and build the skills of staff and help develop a mindset of constant improvement through sourcing for ideas to change and improve the Authority.
“The Group is here to help improve on professionalism and the change management process in GRA,” the then GRA Commissioner-General Kofi Nti said.
Mr Nti said under the improvement process of the Ghana Revenue Enhancement and Transformation (GREAT) Project, the GRA had scheduled engagements with players in the various sectors of the economy, dubbed Industry Forums, to discuss new initiatives as applicable to them.