Government cannot be blamed entirely for tax deficits - Yaw Lartey

The leader for the Financial Advisory unit, Deloitte Ghana, Yaw Appiah Lartey, has said the government cannot be entirely responsible for tax deficits.

According to him, Ghana's tax effort is 14%, whereas countries like Ivory Coast, Nigeria, and Kenya have an 18% GDP tax effort.

Speaking during a panel discussion at the recently held CEO Presidential Gala Dinner in Accra, Yaw Appiah Lartey stated that if Ghana wants to get to its peers, then it must increase the four percentage points.

"Government will have to balance it. It has to be a progressive approach; if you grow aggressively, you will kill businesses. There's a strong correlation between your tax regime and your level of investment, and that has been demonstrated by the oil and gas regime. So in countries where petroleum income tax is lower, there's higher investment in exploration. Exploration has gone down in most countries where there are increased taxes. So you increase your taxes; you achieve your tax target in the short term, but investments decline. So we have to just balance it."

He called for a national long-term development plan, noting that for the many political party manifestoes he has read, there is no reference to a development plan that we are working towards as a country.

"It is almost like we are introducing new things and then running around making marginal progress. We have to have a long-term development plan. What that will do for us is that we build a resilient economy where if we are hit by any of the headwinds that hit us in the last couple of years, we will survive," Lartey stated.

KA

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