Okada legalization to enhance more tax revenue

The illegal but unavoidable Okada business has been booming in Ghana since 2008. It was born out of the observation that daily commuters faced long waits and struggles for transportation at bus stops.

The use of motorbikes for commercial purposes popularly referred to as Okada is not lawful in Ghana but the authorities have not been able to succeed in stopping it. Section 128(1) of the Road Traffic Regulations, 2012 states;

"The Lincensing authority shall not register a motorcycle to carry a fare paying passenger." Despite harrassments, estortions and arrests of Okada operators, the business continued to boom with growing interest from the youth.

The director of Urban studies at the University of Ghana in 2020, Prof. Martin Oteng-Ababio argued in a Citi Breakfast Show interview that no country has ever succeeded in banning Okada. "Let me take you to the African continent, areas where attempts have been made to ban Okada has never worked."

He proceeded to add that "If you go to Nigeria, they restrict them to certain areas. If that is what we want to do, we can have a conversation on that. But to ban it completely, it's something I don't think will ever work. No country in Africa has succeeded not even in Rwanda."

Okada has been accused to be the major cause of road accidents in Ghana. But is this a reason enough to ban Okada without adequately providing alternatives? Remember in 2020, when President Mahama promised to legalize Okada, the NPP on the other hand promised to offer the opportunity to okada riders to acquire cars and pay by installments. They argued that many of the okada riders are not doing it because that is the kind of work they wanted to do.

Four years have passed and the NPP has not been able to implement its alternative promise to the Okada riders. The Okada business keeps booming with many Ghanaian youth embracing it. Prof. Oteng-Ababio have been proven right after all.

Accidents must not be an issue to visit a 'sharp knife on the neck' of Okada. I side with Prof. Oteng-Ababio when he said; "Some of these accidents happen because of their haste to avoid apprehension so once it is regulated, this apprehension will not be there. So our inability to give them the opportunity to operate also accounts for some of these accidents."

He is correct because any job declared illegal can only be done under unsafe and unstructured conditions and so the undesirable effects of the job will be prevalent.

Since we are sure that Okada is forever, we are duty bound to find ways to reduce the undesirable effects while allowing them to operate. As a way of reducing the accidents, it is only correct that we legalize it to embolden operators to operate without fear of arrests and estortions.

The benefits of legalizing Okada are enormous. Aside providing jobs and facilitating the 24-hour economy, it will also be a major source of tax revenue to the government. This is because, an illegal business like Okada cannot be taxed. Taxes on Okada might give the impression that government is a conduit for and benefits from criminal activities.

Since government must not be a conduit for criminality, legalizing Okada will widen the tax base and talks can be initiated to integrate them into our tax administration. Reports have it that there are over 800,000 Okada operators in Ghana as at 2020. With numbers increasing yearly and the high potential for its legalization a number pegged at 1 million will be correct.

Excluding weekends, Okada riders are able to save GH¢13,000.00 in a quarter. A quaterly income tax payment of GH¢40.00 will be in order because tour operators carrying up to 15 persons pay GH¢80.00 quarterly. This will automatically increase total tax revenue by GH¢160million annually which is more than double the amount for road tolls.

This does not include the growing number of operators the legalization will bring into the business and the purchase of more motorbikes to ply this trade.

Clearly Okada is going to be a cash cow for government and we must all unite to ensure its legalization irrespective of whoever wins the 2024 elections. The persistence to stop it is like sending the monkey to go kill the lion so that we can feel safe from fear and death.