Tax and human rigth! Is our government failing?

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Wed, 8 Oct 2014 Source: Mensah-Pah, Jerry Detse

By Jerry Detse Mensah-Pah 

Can you imagine that in spite of scores of children with big head, big stomach and stick legs; school children going to school bear footed and bear chested with empty stomachs; schools under trees; patients absconding from the hospital because they are unable to pay their bills; and all other poverty characteristics one can think of in Ghana: Ghana according to the Statistical Service has crossed the absolute poverty line of GHC 1314 per annum.

According to GSS, the poverty rate here in Ghana now is 24.20% meaning that one out of every four Ghanaian is poor. The tragedy is that Ghana is better than scores of African countries. In as much as I don’t doubt the official figures put forward by the GSS, I equally support reactions by the Deputy Secretary of TUC of Ghana to this rate that “I have no doubt in my mind that if we get the statistics right the poverty rate would be quite high”.

As per this statistics it means that average Ghanaian spends GHC 3.60 a day. Like seriously? “My father always told me that don’t trust a statistics you have not manipulated by yourself” this is according to the Resident Direct of Friedrich Ebert Stiftung Foundation. I am shocked by this information as put across by the GSS.

The broader question that comes to mind with this statistics on poverty rates in a resource rich Ghana is how does Ghana redistribute wealth to address poverty and inequality? In my estimation I think the only antidote to these negative phenomena is ensuring that there is tax justice. This is because the link between taxation and development is fundamental. A functioning state that can meet the basic needs of its citizens must rely ultimately on its own revenues to meet development objectives. Using the tax system, the state can mobilize domestic resources, redistribute wealth and provide essential services and infrastructure.

Every government in the world has certain responsibilities regarding its citizens. The human rights legal framework spells out those responsibilities. However, human rights encompass not just social and political rights, but also economic and social rights. The minimum requirements for the fulfillment of economic and social rights include the provision of available foodstuffs for the population, essential primary healthcare, basic shelter and housing, and most basic forms of education.

I am therefore concerned about how rights are realized through the budget, and how they are violated when states are unable to meet their obligations through weak or unfair taxation. 

But over decades Ghana government struggles to collect enough taxes to fund essential services in a fair way. It is often assumed that tax is a bad thing: that government wants to deprive citizens of their hard-earned money. It is also assumed that citizens do not get value for taxes they pay. A typical example is deep seated corruption within the public sector and wanton dissipation of the country’s resources by state officials and politicians. Proceedings from Justice Senyo Dzamefe Commission of Inquiry into Ghana’s participation in the Brazil 2014 make one wonder if it is actually prudent for one to continue paying taxes. Talk of GEEDA, SADA, SUBA and the scores of fraudulent judgment debts among other ills perpetuated by public officials with tax payers’ money.

Be as it may, from an economic justice and human right outlook, taxes are crucial for redistribution of wealth to address poverty and inequality within the society.

Tax is a vital source of revenue for most governments enabling them to fund essential services and infrastructure for their citizens. Of course, revenues will not automatically be used for such social goods. But when governments get revenue from tax, citizens are in a far stronger position to exert pressure that it be spent on the services which they are entitled.

Taking education as an example, in 1995 the Ghanaian government introduced a new value added tax (VAT) of 17.5 per cent, which initially led to widespread protests. The government was forced to revoke the policy and in 1997 VAT was introduced at 10 per cent, accompanied by an intensive government campaign to create awareness among citizens about what the revenues from the tax would be used for. Subsequently the level of VAT has been raised to 17.5, with revenues of 2.5% each ring-fenced for education through Ghana Education Trust Fund and the National Health Insurance Scheme.

In view of the above, I venture to ask, are resources being mobilized to ensure that governments fulfill their responsibilities towards the progressive realization of rights? If not, a government may be failing in its human rights obligations and may be held to account for doing so.

It therefore behooves on us as citizens to stand up and join the tax justice campaign to frustrate government to move away from AID and mobilize more resources domestically to improve the living conditions of the poor and vulnerable in our societies. However citizens must ensure that these resources are judiciously utilized to the benefit of the citizenry.

The author can be reached on kwamemensahpah@yahoo.com or 0243164704

Columnist: Mensah-Pah, Jerry Detse