The Ghana Revenue Authority is allaying fears over the projected loss of revenue from tax collection due to the implementation of the African Continental Free Trade Agreement (AfCFTA) in the short term.
According to the World Bank, there will be a decline in port tariffs for member countries, as a result of the trade agreement.
The decline in revenue is expected to be moderate in the early years due to progressive liberalisation, however, in the longer term, between 2025 and 2045, the decline will increase from 3% to 9%.
Speaking in an interview with Joy Business after addressing the Tax Research Network Congress, Commissioner General of the Ghana Revenue Authority, Rev. Dr Amishaddai Owusu Amoah explained that trade between African countries are minimal, hence the impact on revenue loss won’t be significant.
“You will agree with me that the intra-trade among ourselves as Africans is not huge and therefore the initial losses are not expected to be significant. But we can’t be idle with coming up with strategies so that as we integrate the systems, people may take advantage of the systems like what happened in the European Union with the introduction of VAT.
“To this end, we are ensuring efficient systems and strategies that will ensure maximisation of trade and boost in revenue for the long term”, he said.
He is confident that the summit will come out with seamless policy recommendations that can help deal with revenue challenges by member states.
This is first time Ghana is hosting the African Tax Researchers Network Congress.
Revenue and Grants fell short of target in first-half of 2022
The Ministry of Finance is expected to mobilise ¢100.5 billion in revenue and grants in 2022.
However, total Revenue and Grants amounted to ¢37.808 billion (7.5% of Gross Domestic Product), compared with the target of ¢43.421 billion (8.6% of GDP) and ¢30.461 billion (6.6 percent of GDP) recorded in the corresponding period in 2021.
The outturn for Total Revenue and Grants represents a shortfall of 12.9% compared to the period’s target and year-on-year growth of 24.1%. The shortfall in revenue, the Finance Ministry said stemmed from the less robust performance recorded in all the revenue handles for the period.