Research and market information firm, Fitch Solutions, expects Ghana’s revenue collection to improve significantly in 2023 on the back of an increase in the Value Added Tax (VAT) rate and other tax measures.
However, it is worried the expenditure estimate for next year is well above its 2022 target, despite its weak fiscal position.
Speaking on the outlook of the Ghanaian economy for 2023, a Senior Country Risk Analyst at Fitch Solutions, Mike Kruninger, expressed worry that the 2022 Budget was expansionary rather than contractionary and failed to address the weak economic fundamentals.
“Minister of Finance, Ken Ofori Atta, presented the 2023 Budget in late November [2022]. As we expected, the budget details a couple of pretty significant tax reforms in order to improve revenue collection including an increase in the Value Added Tax rate up to 15% from 12.5%. The Finance Minister also announced the introduction of a new income tax bracket of 35%, and given that income tax is a vital source for fiscal in-takes for government, we do expect these measures to boost revenue collection in 2023”.
“However, the 2023 budget was significantly more expansionary than we had anticipated”, he stressed.
Mr. Kruninger sad the government expenditure target for 2023 is way beyond target which may affect efforts to narrow the fiscal deficit.
“While the Minister of Finance did announce a couple of spending reforms including ‘high in-freeze’ of public servants and placing salary adjustments on state enterprises, he did not announce large-scale spending plans”.
“Indeed, the spending target for 2023 is well above the spending target for 2022”, he mentioned.
Latest Stories
-
Yaw Nsarkoh: Bit by bit we will understand China
6 hours -
Looted and returned: Asante royal artefacts on display for public viewing at Manhyia Museum
7 hours -
Suspected killer in Kasoa land dispute shooting not a National Security operative
7 hours -
Ghana appoint four Para Athletics coaches in Preparation for Paris 2024
7 hours -
Kumasi Cheshire Home decries inadequate equipment; seeks public support
8 hours -
UCL: Niclas Fullkrug hands Dortmund first leg advange over PSG
8 hours -
GPL: Accra Lions beat Hearts of Oak to go third
9 hours -
Seek higher grounds as rains intensify – GMet warns
10 hours -
May Day: Sam Ankrah promises to prioritise welfare and well-being of workers if elected president
10 hours -
Bawumia plans door-to-door campaign for 2024 polls
10 hours -
GAF condemns ‘unprovoked’ fatal shooting of soldier in Kasoa land dispute
10 hours -
OSP’s request for money laundering probe against Cecilia Dapaah baseless – AG advises EOCO
11 hours -
Obofour Raphael releases ‘Asem Yi Di Ka’ EP
11 hours -
‘Operation Clean Your Surroundings’: Popular Kenkey joint and public toilets in Takoradi shut down
11 hours -
GFA boss Kurt Okraku graces Dreams FC’s dinner to celebrate CAF Confederation Cup exploits
12 hours