Accra: Professor Godfred Alufar Bokpin, an economist, has stated that Ghana's International Monetary Fund (IMF)-backed reforms have not achieved the desired structural improvements in domestic revenue collection. He emphasized the need for authorities to enhance tax administration, close existing revenue loopholes, expand the tax net to include the informal sector, and reduce dependence on fluctuating commodity revenues.
According to Ghana News Agency, Prof Bokpin made these remarks during an interview on Ghana's revenue performance under the IMF programme, coinciding with a public financial management and fiscal decentralization training for journalists. In 2023, Ghana established the National Revenue Policy (GNRP), guided by the Medium-Term Revenue Strategy (MTRS), aiming to improve its tax-to-GDP ratio, which the Ministry of Finance noted has hovered around 12-14 percent since 2015. Despite the completion of a US$3 billion IMF-loan supported program intended to address this gap, the tax-to-GDP ratio has averaged 14 percent during the program's implementation, according to Prof Bokpin, who is also a professor of Finance at the University of Ghana Business School (UGBS).
The Ministry of Finance's first-quarter results indicated that GHS57.53 billion was mobilized, slightly below the target, despite expectations that revenue measures would generate about GHS268.1 billion by year-end. Prof Bokpin explained that the domestic revenue's underperformance suggested that reforms had not significantly strengthened the revenue base, despite years of IMF-guided policy changes. He noted that Ghana's revenue envelope had not substantially improved even with IMF-inspired reforms, adding that the country is not exposed to foreign exchange fluctuations due to gold-backed foreign exchange reserves held by the central bank, but emphasized the need for financial resources.
Prof Bokpin expressed concerns about regime changes affecting both businesses and tax revenue, observing that businesses often become inactive until their affiliated political party gains power. He stressed the need for a stable, growing indigenous business base across all sizes to sustainably expand the tax net, highlighting that political instability leads to business collapses, stunting tax base growth.
In contrast, Dr Cassiel Ato Baah Forson, the Minister of Finance, reported during the mid-year budget review presentation last month that domestic revenue had reached 7.7 percent of GDP by June 2026, just shy of the 7.8 percent target. He acknowledged that better policy, stronger compliance, and smarter administration would yield more sustainable revenue than merely increasing taxes. Dr Forson also mentioned the introduction of AI-powered customs reforms, which have increased Customs revenue by approximately 15 percent.