Wonderful jingles and education on the airwaves are directed at the Ghanaian populace to honour their tax obligations to the state. That taxes are the pivot around which nations are developed, are incontrovertible. Governments of our immediate post independent era had a lot of raw materials to export to generate funds to meet the developmental needs of this country. I remember in one of my Economics text books (written by a Ghanaian) in my Secondary School days, we were told that before and immediately after independence, the revenue from the export of a ton of cocoa beans could purchase a VW salon car at the time.
Those were the days when the now developed nations needed our raw natural resources to boost their growing manufacturing and industrial sectors, so prices for our exports were relatively higher. Even though some amount of these resources had been exploited in the colonial era to our detriment, they still need them in the post -independence relationship. Our interests were more focused on revenues from our exports than internally generating taxes.
The raw materials have fundamentally been depleted to a point that in some cases, local requirements cannot even be met by these raw materials which used to be taken for granted. A typical example in our case is timber. Secondly, the world has developed a number of alternatives to the raw materials which used to give us a certain leverage in our trade relations with other nations. Consequently, our export prices have kept on dwindling in both real and nominal terms. The more we exploit and sell, the less money we obtain to meet the needs of our growing population.
The Ministry for Finance and the Ghana Revenue Authority have embarked on educational campaigns to get Ghanaians to live up to their civic responsibilities in the area of tax payments. This is not the first time a government has embarked upon such a vigorous campaign to get more revenue from within rather than overly depending on foreign loans, aid and grants to execute its mandate of service delivery to the people.
No government of recent times has had it easy with the administration of this country. The population of this country keeps on increasing, the age distribution exacts huge expectations on governments. The aged require good health services to keep them a little longer, the children need quality education as represented by modern classroom blocks, good and modern learning and teaching materials, balanced diets to ensure good health and excellent physical growth. The youth need jobs in their most productive years. These require huge financial investments.
There is so much pressure on social and economic investments, roads are deteriorating faster than anticipated because of their usage, it is worse in the cities and the urban and peri-urban settlements. Rural roads are the worst even though the inhabitants in these parts of the country produce our daily subsistence for our survival. Governments know their needs, but sometimes look so helpless because they do not have the funds to meet these needs.
While it must be admitted that a very huge chunk of the nation’s resources are wasted through corruption and plain thievery, a sizeable portion of the populace do not pay taxes to increase government’s revenues to support the service delivery function. Governments are compelled to either borrow from external sources or from within to meet these infrastructural demands at the minimum levels.
The efforts to get citizens to be alive to their civic and legal responsibilities through public education is a welcomed one. However, I need to caution that education in itself, particularly in this country, does not get people to do what they are legally obliged to do. It is the strict enforcement of the law that get people to do what they are supposed to do.
The tax agencies in this country have all these while focused on the limited group of people who have done what they are expected to do, leaving a huge segment of the populace paying no direct taxes at all. There is a certain Middle and Upper class people in this country who exhibit affluent lifestyles without any visible means of livelihood or tax payments.
When one sees the types of flashy and expensive vehicles on our roads, it is difficult to believe this is a poor country. I am not writing out of envy. My only concern is, do the owners of these flashy vehicles pay the appropriate taxes on their incomes? Have we noticed the type of mansions these classes of people build in all the developing areas in this country? How do we assess their incomes and the accompanying taxes they pay to the state?
This is the difference between those of us in the developing countries and the developed countries. Any additional asset anyone acquires out there means additional income which must be declared and the relevant taxes paid on them. That is not the case in this country. So many people are not captured in the tax net unless they need tax clearance certificates to do one thing or the other.
Once upon a time in this country, applicants for Passport had to provide tax clearance certificates. Today, people move in and out of this country with much ease than travelling within the country. Can the acquisition of a visa be accompanied with a tax clearance certificate for example?   I am just thinking aloud. Just recently, Hon. Yaw Osaafo Marfo talked about property tax. I am very sure property owners are not paying this tax, indeed even the meagre property rates to the MMDAs are not paid and these are the same category of people who demand good roads, water and uninterrupted supply of electricity from the state as a right. Yes, it is their right to enjoy these services. But what is their obligations to the state?
Nobody wants to pay taxes if the collectors are not willing to collect them. One way the GRA can bring property owners to pay taxes is to present them with Tax Assessment Forms to fill to declare their incomes and expenditures as is done with all forms of assessments. Property owners certainly are income earners. How much of those incomes did they pay to the GRA? I am not bothered about how they made their monies, but the taxes on the monies so made must be paid.
What the GRA has to do is recruit the thousands of unemployed graduates of all categories of the academic ladder on Commission bases to submit these forms to property owners with stated timelines for the recipients to respond to them. I am sure there are sufficient laws to support the GRA in this direction. Just begin with the affluent settlements in this country and see what the results will be. It is the enforcement of the laws that ensure compliance and not education. Ghanaians are not ignorant about their tax obligations; they take advantage of the laxity of the system. It is this laxity that we have to eliminate.
It is also important to draw the attention of both the GRA and the Finance Ministry to the fact that sometimes the processes GRA uses in getting citizens to open up to them is so cumbersome. Let’s make it much simpler. The Authority should also consider eliminating ‘writing’ receipts by VAT registered businesses to customers. Every registered business must use Cash Registered Machines to print out the receipts to customers. It is easier and does not lend itself to suppression of the face value of the payments made. The Ministry can procure them for the businesses. Again, young people can be trained to service these machines and assigned to specified areas to ensure that business people do not use the breakdown of their machines to do what is wrong.
A few weeks back, I suggested a paltry tax of GH¢0.05 on re-load cards for mobile phones but the Minister ignored it in his budget because the opposition was making noise about it. President Nana Addo is delivering on his promise but he needs money to do that. He should not be stampeded by the opposition.
Well, some three tots of it.
From Kwesi Biney