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Finance Minister Ken Ofori-Atta said a tax exemption bill had been tabled in parliament to streamline tax exemptions.
Speaking before Parliament last Thursday, Ofori-Atta said the adoption of the draft law on tax exemptions would also help to reduce abuses.
The government has been supported by the International Monetary Fund (IMF) to reorganize its tax exemption regime in order to increase its faltering domestic revenues.
In its review of Ghana, the IMF said streamlining tax exemptions would improve domestic revenue mobilization.
The evolution of domestic revenues over the last two or three years has not matched the budget projections. Last year, the previous target was only about 10%, which led the government to realign its spending with the deficit.
"… It was agreed that tax exemptions would be streamlined and their management framework strengthened to improve domestic revenue mobilization. The authorities estimate that tax exemption costs will rise to 1.6% of GDP in 2018, "said Annalisa Fedelino, who led an IMF team in Accra in February to conclude discussions on the seventh and eighth reviews. combined with Ghana's expanded credit program.
In his speech on the state of the nation delivered in February, President Akufo-Addo described the current policy on tax exemption as an Achilles' heel and a growing threat to fiscal stability and income generation.
Over the past eight years, tax exemptions for import duties, VAT on imports, NHIL on imports and domestic VAT have increased from three Ninety-two million Ghana Cedis (GH ¢ 392 million), or 0.6% of GDP in 2010, to 4.66 billion GH ¢ or 1.6% of GDP in 2018.
According to the President, this is not sustainable and the government intends to take action to reverse the trend – by introducing appropriate measures that could disrupt the simple and comfortable arrangements that many people have gone through. regulars.
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