There was no mention of the review of taxes in the mid-year budget review. This may come as a source of relief to the business community as well as Ghanaians at large.
Before the presentation of the budget, various trade unions and experts as well as the minority in parliament, cautioned the government against any attempt to increase taxes or introduce new ones in the mid-year budget review.
Finance Minister Ken Ofori-Atta during the presentation of the review noted that the government did not need or require a supplementary budget. This meant that the government was not seeking any additional funding for the projects it outlined in the 2023 budget.
Instead, the government revised Appropriation i.e its allocations downwards has been revised from GH¢227.7 billion as presented and approved in November 2022 to GH¢206.0 billion.
Also, key macro-fiscal targets for 2023 have been revised.
These include
i. Overall Real GDP Growth rate of 1.5 percent down from 2.8 percent;
ii. Non-Oil Real GDP Growth rate of 1.5 percent down from 3.0 percent;
iii. End-period headline inflation of 31.3 percent, from 18.9 percent;
iv. Primary Balance on Commitment basis of a deficit of 0.5 percent of GDP
compared to a surplus of 0.7 percent of GDP, aligning with IMF-supported PC-PEG target Primary balance;
v. Gross International Reserves (programme definition) sufficient to cover at
least 0.8 months of imports of goods and services by 2023.
According to the Minister, “The downward revision in projected growth for 2023 is an indication of a broad slowdown in the three sectors of the economy as a result of factors such as the fiscal consolidation plan and difficult global conditions.
“Mr. Speaker, overall GDP Growth is, however, projected to rebound to 2.8 percent, 4.7 percent, and 4.9 percent in 2024, 2025, and 2026, respectively. This is a result of the implementation of growth-oriented and structural transformation strategies in the PC-PEG,” the Minister noted.
“We have, however, been charged in the PC-PEG to develop an enhanced Growth Strategy supported by crowding in of private domestic and foreign investments to further boost growth. We are confident of a private sector outlook to boost growth and jobs,” he explained further.
SSD/NOQ
Taxes in Ghana