General News of 2014-02-01

Nana Konadu's tax analysis is confusing - Minister

Deputy Minister of Information and Media Relations, Murtala Mohammed says former First Lady, Nana Konadu Agyeman-Rawlings is only seeking media attention with her “confusing” analysis of the impact of taxes on the economy.

He said “Nana Konadu is not an economist, and she is only looking for public attention with this confusing economic analysis.”

The former first lady had asked, at a recent public forum, why government increased the VAT [from 15% to 17.5%] and why they have increased other taxes and also taxing many more items.

According to her, economies around the world are hardly run on taxes because it is taxes that kill the private sector and discourage further investments, particularly for a developing country like Ghana.

Nana Konadu had also argued that the way to go for a developing economy is rather to reduce taxes in order to attract more private investments, create jobs and increase people’s purchasing power.

She also accused the government of using the taxes to balance their budget rather than investing in the real sector to improve living standards.

But in a sharp response on Adom News, Murtala Mohammed said Nana Konadu does not know economics, and her analysis is nothing short of a display of ignorance and confusion about taxation.

“I don’t know whether she was talking economics, architecture, psychology or physiology. I really couldn’t get her. I didn’t understand, and I believe your listeners themselves were confused if they listened to her that we use the taxes to balance the economy,” Murtala asserted.

He said contrary to Nana Konadu’s assertion that countries around the world are hardly run on taxes, a close look at economies around the world would rather show that taxes form about 60 to 70 per cent of the national income of developed countries, and Ghana is not even a developed country yet.

Murtala Mohammed also stated that Nana Konadu’s claim that the taxes collected in Ghana are used to balance the budget and not for national development was rather disingenuous and pretentious.

He explained that budgets are futuristic plans for spending on national development, and taxes constitute a part of the income used to meet that national development budget, so her analysis about not using taxes for development show her confusion and ignorance about the subject.

“Moreover if Nana Konadu claims she does not see the development projects going on around the country, then she is pretending,” he said.

Murtala Mohammed said Nana Konadu Agyemang Rawlings has been out of the news for a long time, and she is just seeking public attention with her confused tax analysis.

“The way her husband JJ Rawlings managed tax revenues 20 years ago [which we in the NDC were very proud of] is the same way the Mahama government is managing taxes,” he said.

The Deputy Minister said the people of Ghana gave a four-year mandate to the Mahama-led NDC government based on the party’s manifesto, and Ghanaians have the opportunity to judge the party after the four years.

He believes the Mahama government will deliver on the mandate and to the people’s expectation.