Following the inability of the Ghana Revenue Authority (GRA) to meet its domestic revenue mobilisation targets in the last four years, the Finance Minister, Ken Ofor-Atta has revealed government’s intentions of reviewing the country’s existing tax systems, “ ABC News can report.
The review, he said, will see the introduction of more private sector-led solutions in the revenue mobilization efforts ahead of the 2020 budget presentation next week.
Speaking on Citi FM, the Finance Minister said although customs revenue make a significant chunk of government revenue, it is not the driver of growth.
“We really need to disabuse ourselves of that; make it efficient nonetheless but really look at corporate taxation and spreading the net in a more effective way. We look to reviewing all of our tax systems in 2020,” Mr. Ofori-Atta said.
The GRA’s revenue target for 2019 was pegged at GHC45 billion and as of September 2019, the Authority announced that an amount of GHC32 billion had been obtained.
The GRA failed to meet its target of raising GH¢24. 5 billion at the end of August 2018. Instead, it managed to mobilise a total of GH¢22.7 billion representing a revenue shortfall of about GH¢1.8 billion.
The government, in recent times, responded to the revenue shortfalls with a number of tax reforms as well as institutional reforms at the tax collecting authority but the measures could not prevent a shortfall of GH¢5 billion as at July 2019.
In addressing this, Mr. Ofori-Atta said government will conduct holistic reforms that would place a premium on the role played by private sector-led initiatives in mobilising revenue.
“We have been responding, changing different handles to suit the moment. I think it is time to look at the whole infrastructure of taxation especially as we are now looking to private sector solutions to the transformation,” the Finance Minister revealed.
In its quest to involve the private sector in revenue mobilisation, the GRA last year secured the services of Mckinsey Group, an international consulting firm, to offer its expertise to help boost revenue generation.
The Group’s engagement was to help change GRA’s systems to be comparable to the best in revenue administration in the world through simplified processes and innovation.
The Group was expected to train and build the skills of staff and help develop a mindset of constant improvement through sourcing for ideas to change and improve the Authority.