Accounting firm, PricewaterhouseCoopers is linking current signs of economic stability to the IMF program.

However, it is worried about what will happen to the economy after Ghana completes the IMF programme.

These concerns were captured in the PwC Analysis and Perspective on the 2024 Mid-Year Fiscal Policy Review.

Price Water House Coopers PwC in the report was also worried about the outlook of the company adding that, “what will happen when these restraints are removed? Will the trajectory of our economic recovery continue into sustainable broad-based growth in real terms?”

The Accounting and Auditing firm noted that “For us at PwC, the answer to that question is not as lucidly or convincingly explained in the Minister’s speech as would have helped to provide the comfort that businesses see.”

PwC also added that the focus on short-term performance is not sufficient, adding that, “we recognise that, constrained by the restrictions and conditions of an IMF programme and the fact that Government has little room for fiscal laxity.”

PwC, however, urged the government not to overlook the long-term objectives of both the PC-PEG and the IMF program while touting what appears to be a good recovery in the short term.

“If the difficult reforms we need to implement continue to get delayed because the timing does not seem suitable, we permit the problem to fester some more” the accounting firm added.

PwC however warned that “it is possible that our economy will revert to a state that may require a future Government to return to the IMF with cup in hand.”

Proposed measures to check budget overruns

Finance Minister Dr. Mohamed Amin Adam announced in the Mid-Year Budget that the Cabinet has approved the establishment of an independent Fiscal Council.

The Finance Minister also revealed that steps are being taken to sanction any government agency that fails to comply with public financial management spending requirements.

However, PricewaterhouseCoopers, in its report, noted that, unfortunately, these actions do not provide additional comfort.

This is because as a country “we are fond of creating new institutions as a way of solving problems and  We choose this route even when enough tools for solving the problem already exist.”

“Our considered opinion is that a Fiscal Council will only layer on additional costs that could be avoided,” Pricewaterhouse Coopers added.

Proposed Revenue Measures

The Finance Minister in the 2024 Mid Year Budget Review several measures aid at improving revenue mobilization.

1.Some of the measures included: Simplified Digital Solution and Electronic Booking System.

2. Onboarding of additional taxpayers onto the electronic invoicing system
3. Re-institute the integrated property tax system

4. Broaden the scope of VAT exemptions on active pharmaceutical inputs, excipients and other finished pharmaceutical products

6. Simplified Digital Solution and Electronic Bookkeeping System

On Simplified Digital Solution and Electronic Bookkeeping System, PricewaterhouseCoopers in the report noted that while these intentions are commendable, we would encourage Government to expedite the operationalisation of these measures to support the nation’s fiscal consolidation agenda.

Regarding moves to expand the number of taxpayers on the e-VAT platform will increase compliance and revenue generation, PWC noted that Government must however provide timelines and modalities to businesses on how it intends to bring in the additional set of taxpayers.