Volumetric Effects Of New Tax Measures Targets The Poor, Students, Market Women -John Gatsi


Head of Finance Department of the University of Cape Coast, Prof John Gatsi has expressed worry over government's attempt to increase the Energy Sector Levies by Ghc

20p per litre for petrol and Ghc 80p per kilogram for diesel, in order to increase the cash inflows which will enable government issue an additional bond to pay down the country's energy sector debt obligations.

The financial analyst explained that the tax measures are directed towards areas that affect consumption of average households including the poor.

He said, "the increase in LPG and fuel has serious cost implications on households and businesses, since their level of consumption would not reduce and that would amount to a huge cummulative cost for them".

He explained further that most government agencies will also suffer for increases in volumetric cost of fuel which would undermine the budget execution. Prof Gatsi added so that, increase in talk time tax will affect data users including students, market women, low income earners but would generate revenue for government.

Prof Gatsi described the new tax measures as a replacement for the luxury vehicle tax so as to capture many people as well as vehicle owners.

He questioned why government would intend reducing the burden of tax on industries and the general Ghanaian community at large and then again attempts to increase the ESL.

"If the earlier downward review of the ESLA was meant to reduce the burden of tax on industries and the Ghanaian society, how do we describe the current increments? Prof

Gatsi's comments follow the presentation of the 2019 mid-year budget review by the Minister of Finance, Ken Ofori Attah in which government has asked for Parliament's approval to spend an additional Ghc6.3 billion on the 2019 budget presented in November 2018.