Accra: Ghana can raise substantial additional domestic revenue by improving Value Added Tax and corporate income tax compliance, the Tax Justice Coalition-Ghana has said. The Coalition highlighted that closing existing tax gaps could generate more revenue without introducing new taxes or increasing existing tax rates.
According to Ghana News Agency, Mr. Benedict Doh, National Coordinator of the Tax Justice Coalition-Ghana, emphasized that revenue mobilization efforts should focus on broadening the tax base and improving compliance rather than imposing additional tax burdens on citizens and businesses. Mr. Doh, who also coordinates the Tax Justice Platform and works with Transparency International Ghana, noted that studies have identified significant opportunities to mobilize more domestic resources through VAT and corporate income tax handles.
Mr. Doh pointed out that available studies indicated notable gaps within the VAT and corporate income tax regimes, suggesting that considerable revenue remained uncollected under the existing tax framework. He advocated for improving tax administration, strengthening compliance, and bringing more taxable economic activities into the formal tax system to help the government increase domestic revenue.
He further emphasized that broadening the tax base remained one of the more sustainable approaches to domestic revenue mobilization and could support Ghana's development financing needs without placing additional pressure on existing taxpayers. Mr. Doh identified illicit financial flows (IFFs) as a major challenge to revenue mobilization, stating that the movement of illicit funds out of the country deprived the state of resources that could otherwise be invested in infrastructure, education, healthcare, and other essential public services.
Mr. Doh also called for greater transparency and accountability in granting tax exemptions. He noted that the Tax Exemptions Act, passed in 2022, required the publication of annual tax expenditure reports detailing the value of tax exemptions granted by the state. The Act also provides for cost-benefit analyses to determine whether the economic benefits of tax incentives justify the revenue forgone by the Government.
He emphasized that effective implementation of these provisions would strengthen public accountability and provide policymakers with information to assess the effectiveness of tax exemption regimes. Additionally, Mr. Doh called for increased disclosure of beneficial ownership information on companies receiving tax exemptions.
On tax equity, Mr. Doh remarked that reforms should promote fairness and avoid worsening existing social and economic inequalities. He highlighted that members of the Coalition continued to advocate greater attention to the gender dimensions of taxation to ensure that tax policies did not disproportionately affect women and vulnerable groups. "Tax policies, if not properly designed, could end up deepening inequality in society," he said.