A popular social commentator has noted the shifting positions of the NDC and NPP on the contentious issue of Value Added Tax (VAT) and has concluded, the value of these two main parties is the same.
Kwesi Pratt, Managing Editor of the Insight newspaper is at a loss as to why the National Democratic Congress (NDC) while in opposition would impose VAT only to increase it when they are in power. The New Patriotic Party(NPP) is no different, he said.
On May 11, 1995, thousands of Ghanaians poured onto the streets protesting the then Rawlings-led NDC governments decision to introduce the Value Added Tax (VAT) at a rate of 17˝%. The NPP described the percentage proposed by the then NDC government as astronomical.
A massive protest turned violent after government forces opened fire on the demonstrators leading to the death of four persons including 14 years old pupil of Liberty Avenue JSS, Ahunu Horgar.
Government eventually reduced the rate to 10% in what was seen as a victory for the opposition but eventually increased it to 12.5 in 1998. In 2008, the NPP in power would increase VAT from 12.5% to 15% as National Health Insurance Levy (NHIL).
The NDC walked out of Parliament in opposition to the increase. The then Minority Spokesman on Finance Mr. Moses Asaga described the 2.5% increase as an attempt by the NPP to satisfy an IMF conditionality.
Fast forward to 2013, the NDC now in power has once again increased it to 17.5% last Friday with the NPP boycotting the sitting. A Deputy Minister of Education Samuel Okudzeto Ablakwa says they need the money to fund infrastructural projects.
Speaking on Adom TV's Badwam, Kwesi Pratt condemned the two main parties for abandoning previously held beliefs and opinions whenever it was politically correct.
In view of the way the NPP and NDC are exchanging scripts on the benefits of VAT, Pratt is asking both parties, "where is the truth?". "what kind of thinking is this", he said of the leaders of both parties.
VAT is a regressive tax where everybody pays the same irrespective of whether one was poor or rich, he explained saying it is unfair and discriminatory.
Any better way to raise taxes?
Although government keeps increasing taxes on almost everything, Pratt believes there are better ways of funding development without relying on taxation.
"Why are we so dependent on taxation" he said after highlighting some opportunities for government to increase revenue.
He identified a report by the Forestry Commission which said bush meat have the potential of contributing more than the 5% Ghana gets from exporting gold exports.
He cited the instance whereby although Ghana has a huge potential in tilapia production yet the country imports tilapia from Germany.
He said because of monopoly of GHACEM, cement from South Africa is cheaper than cement produced in Ghana.
Government could also renegotiate for better earnings on precious minerals as some of the better ways of raising revenue, Kwesi Pratt recommended.
How could government spend 450 million dollars to import perfumed rice when it could use this money to grow rice and raise revenue? Pratt lamented.
According to the social commentator raising revenue creatively "is not rocket science".
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