The Ghana government collects taxes from only two out of the six million eligible taxpayers, a tax expert, Dr Edward Larbi Siaw has revealed, adding that �we cannot con�tinue to deal with a population of 25 million and collect taxes from only two million.�
The need to address this gap in our revenue collection drive has become ex�tremely urgent as Ghana can no longer borrow under concessional rates and for long periods, he said, explaining that this is because of Ghana�s �present rating as a lower middle income economy, which has also led to a reduction in the avail�ability of grants and aid.�
Dr Larbi Siaw, a Tax Policy Advisor to Ghana�s Ministry of Finance and Eco�nomic Planning, said this while deliver�ing a keynote speech at the opening of a five-day International Conference on Fiscal Justice last week.
�The country cannot continue to in�crease tax rates for those in the tax net and leave out others,� he said, adding that national tax policies and revenue performances have direct impact on the overall budget deficit.
Dr Siaw told participants at the con�ference the Ministry of Finance wecomes suggestions, workable strategies and recommendations proposed by the conference to help improve the tax sys�tem in the country.
Earlier, the Deputy Campaign Direc�tor of OXFAM International, Mr Stephen Hale, said while taxation was the most sustainable source of financing development, �there was still a substan�tial lack of capacity and insight of civil society into the technical-fiscal domain of a country�s tax system.�
He said the conference - which was organised by OXFAM Ghana, in collab�oration with the International Tax Com�pact and Tax Justice Network-Africa, all non-governmental organisations - was therefore expected to make recommen�dations on the need to engage develop�ing countries and Civil Society Organisations (CSOs) in the effort to re�form international tax systems.
Representatives from international organisations, CSOs and government from about 15 African and Asian coun�tries participated in the conference.
Mr Hale maintained that to achieve greater accountability, civil society must be well positioned through avenues such as public forums for discussions to pro�mote fair and pro-poor tax systems, rein�force public scrutiny of tax governance, and promote a national dialogue on the desirability of more progressive taxation.
Tax revenues in developing countries fall short of what realistically could be obtained when analysing their actual po�tential and capacity, both in terms of ef�ficiency and progressiveness, he said, �tax policies in developing countries were oriented towards collecting taxes easily, including consumption and wage taxes which impose a higher tax burden on poorer households and formal sector employees.�
According to Mr Hale, on the aver�age, 18% of Gross Domestic Product (GDP) comes from tax revenues in African countries, compared to an aver�age of 38% in Western European coun�tries.
Although the world had created so much wealth which could resolve edu�cational and health-related issues, such resources were concentrated in the hands of the top 1 % rich people, he said.
�A recent OXFAM paper has re�vealed that the top 85 people in the world control as much as the earnings of 1.5 billion people,� he said.
Mr Hale further explained that OXFAM�s recent research revealed that improving taxation could potentially raise $269 billion annually, which could be sufficient to cover 60% of the financ�ing requirements for achieving the Mil�lennium Development Goals.
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