Audio By Carbonatix
Fitch Solutions had said in its 2023 February Africa Monitor Report that Ghana’s 2023 revenue target is unrealistic.
In 2023, the government intends to collect total revenue and grants of ¢143,956 million, about 18.0% of Gross Domestic Product.
This however represents a 43.2% increase on the 2022 target.
“That said, we believe that the 2023 revenue target is unrealistic. While higher taxes will boost fiscal intakes, weakening economic activity on the back of still-elevated inflation and tighter monetary policy will cap revenue growth”.
“Indeed, we forecast the economy to expand by a weak 2.9% in 2023, well below Ghana's 10-year pre-pandemic average of 6.8%. In addition, easing global oil prices in 2023 (our Oil & Gas team projects oil prices to fall by 6.9% to an average of $95.0/barrels) will put downside pressure on receipts from the oil sector”.
Furthermore, it said the Government of Ghana has a track record of overestimating intakes.
“Taking these dynamics into account, we believe that total revenues will rise to ¢134.4 billion in 2023 (compared to the target of ¢144.0 billion) or 18.0% of GDP, from 15.0% of GDP in 2022”.
It continued that fiscal intakes will improve on higher taxes in 2023".
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