The NPP administration is set to court some more public anger as the International Monetary Fund (IMF) has advised it to consider increasing taxes and reintroduce some taxes that were scraped and described as ‘nuisance taxes’.
Being a major donor and economic advisor, the Akufo Addo administration may be left with little choices than to heed the advice from the Bretton Wood institution, in its 2019 Article IV Consultation report.
The new tax regime could see Value Added Tax shoot up to 17.5 per cent VAT on financial services, and may force a spike on the controversial Communication Service Tax (CST) to 12 per cent. This tax which raised widespread public anger was recently hiked to 9 per cent from 6 per cent.
Experts say the it’s a ‘fine opportunity for government to further clamp-downm on social media networking in an election year and also
The IMF which thinks the government has reached a debt unsustainability levels is further advising it to also implement long-term measures such as tax policy reforms, a comprehensive tax exemption policy, and an effective tax administration system in order to maintain a healthy level of tax revenue in the long-term.
“Tax policy reform could focus on mining taxation and exemptions. Measures in mining and petroleum should mainly consider a comprehensive review of the mining legislation and fiscal regime applicable to all future contracts; unifying various laws into a single extractive industry legislation. The exemption bill, submitted in Parliament, does not address several tax expenditures which could be considered for further streamlining,” the IMF stated.