Government’s new tax imposition disproportionate to other segments of society – Theo Acheampong

Economist and Political Risk Analyst, Dr Theo Acheampong says government’s new imposed taxes are disproportionate and unequal to other segments of the society.

This according to him, is a challenge that ought to be addressed as a nation.

Speaking in an interview on Joy New’s Newsfile Saturday, he said government has done well in supporting Small Scale Enterprises (SMEs) in the hospitality and services sector by compensating them with tax deferrals although it has introduced new taxes into the system.

“For example there’s an extension on the payment of corporate income tax for 9 months for this year although even that you need to be in the tax paying position before you can actually pay corporate income tax in the first place.”

This, he said depicts that the measures of which taxes were imposed on Ghanaians are “disproportionate, they are unequal and it shows that the tax burden in this country is not evenly shared among the segment of the population.”

“I also teach tax a bit and Mr Terkpey would tell you, a couple of the key principles of taxation is efficiency and tax neutrality and when you look at a lot of the new taxes imposed, the dead weight loss is that big so at the end of the day, what you don’t want to do is to distort the economic decisions of individuals and firms because they really are the key to sustaining the economy even beyond government policy or government action,” he said.

According to him, fuel and energy is a key component in the productive of primary process in the country therefore an increase in energy related tax would dry up inflation as well as deepen inequality if government does not have any compensatory effect or compensatory policy action.

He added that the new imposed taxes would also tend to have that disproportionate impact the consumption related taxes.

Mr Acheampong noted that in times where the country is recovering from economic hardships, it is inappropriate for new taxes to be imposed but rather the need to support individuals and firms.