Shift from Taxation to Production-Driven Policies – Prof Bokpin
By Praisebell Rosemond Larbi
Economist and senior lecturer at the University of Ghana, Professor Godfred Bokpin, has urged the government to reduce its heavy reliance on taxation and instead focus on policies that stimulate production and economic growth.
Finance Minister Dr. Cassiel Ato Forson is expected to present the 2025 budget on Tuesday March 11, drawing high expectations amongst businesses, investors and generally Ghanaians, hoping for a budget that will not only provide relief from excessive taxation but also introduce long-term economic strategies to ensure growth, stability, and prosperity for all. Speaking in an interview with The New Finder ahead of the 2025 budget presentation, Prof. Bokpin emphasized the urgent need for a policy shift, stating that excessive taxation was stifling businesses and slowing economic recovery.
According to him, the President had previously acknowledged that Ghana’s economy was overburdened by taxes and had pledged to transition toward a production-driven model. He believes that the upcoming budget must reflect this commitment through clear tax revisions and incentives to boost industrialization and job creation. “Given that both parties agreed the economy is heavily taxed and pledged to shift from taxation to production, I expect the budget to outline clear tax revisions,” he stated. Prof. Bokpin identified several levies that he believes should be scrapped, including the COVID-19 Levy, the E-Levy, and the Emission Tax.
He argued that removing these taxes aligns with the government’s 120-day social contract with Ghanaians, which promised relief from burdensome taxation. According to him, the continued imposition of such taxes has placed unnecessary financial strain on both individuals and businesses, discouraging investment and economic expansion. Beyond tax reforms, he also stressed the need for broader fiscal adjustments, urging the government to curb excessive spending and introduce stringent measures to promote financial discipline.
He noted that while the government has often spoken about reducing wasteful expenditures, there must be real figures in the budget that clearly outline how spending will be controlled. “The government has indicated plans to cut wasteful spending, but we need to see real figures in the budget. It’s not just about central government; state-owned enterprises must also operate more efficiently,” he added.
Prof. Bokpin further explained that Ghana’s economic challenges stem from a fundamental imbalance between aggregate demand and supply. He warned that without policies to boost local production, create sustainable jobs, and attract investment, the country would continue to struggle with inflation, unemployment, and sluggish economic growth. To address these challenges, he urged the government to prioritize production-driven policies that will increase the country’s export capacity, reduce dependency on imports, and strengthen the local economy. He suggested that targeted support for industries such as agriculture, manufacturing, and technology could help drive sustainable economic growth while reducing the pressure on tax revenue as the primary source of government funding. With the economy facing multiple challenges, all eyes will be on Parliament as the government unveils its financial blueprint for the year ahead.
