Veep’s tax reforms good but can’t wait till 2025

By Isaac AIDOO, Accra

Professor of Finance at the University of Ghana Business School (UGBS), Prof. Lord Mensah, says tax reforms proposed by Vice-President Dr. Mahamudu Bawumia are progressive but should not wait until after the 2024 elections to be implemented.

According to Prof. Mensah, delaying such fine policy reforms for electoral reasons would be too costly for the state and the citizenry.

In a lecture outlining his vision and policy priorities for Ghana ahead of the 2024 elections, Dr. Bawumia promised that Ghana would have a new “friendly” flat tax regime if he were elected President. He also pledged digital reforms to streamline online filing of tax returns, ensuring that the process could be completed in minutes.

Prof. Mensah told The New Finder that Dr. Bawumia’s proposal was welcomed by businesses; however, his decision to delay the reforms until he became president would cost the country.

“From where I sit, having a flat rate tax regime gives assurance to businesses about the kind of returns they should expect on their investments rather than facing tax inconsistencies among other challenges,” Prof. Mensah said in an interview.

On the abolition of some taxes, Prof. Mensah pointed out that by the time those taxes are removed, businesses affected by the taxes would have relocated to other more friendly countries.

 He wondered whether the NPP flagbearer was waiting for the companies to leave, then expecting them to return once the taxes are removed.

He cautioned that the economic cost of delaying policy reforms is substantial and should not be taken for granted.

He emphasized that if there are policies beneficial to the country, they should be introduced promptly, especially since Dr. Bawumia is part of the current administration.