Finance Minister Presents Mid Year Budget Review Today

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The Finance Minister, Ken Ofori-Atta will today (Thursday) present before Parliament the government’s 2018 mid-year budget review.

The presentation is in line with Ghana’s Financial Management Administration Act which requires that the Minister for Finance appear before Parliament not later than July 31, to submit a Mid-Year Fiscal Policy review.

The review is to afford the government the opportunity to announce its revision of its economic targets whose key components include the country’s macroeconomic performance and forecast for the remaining half of the year.
Also, it will also analyze the country’s revenue targets and expenditures.

Although the presentation of mid-year budget reviews has often attracted low interests, this year’s presentation has courted a lot of buzz and controversy due to speculations of a possible announcement of an increment in VAT from 17.5% to 21.5%.

The suggestion first came from Mr. Gabby Asare Otchere-Darko, a leading member of the governing New Patriotic Party (NPP), whose pro-NPP newspaper the New Statesman, went ahead to publish same.

But that suggestion was greeted with mixed public reactions with majority including some stakeholders kicking against the speculated plan.

Members of National Democratic Congress (NDC) minority in Parliament also vehemently announced their opposition to the speculated increment.

Speaking at the Minority’s version of a mid-year budget roundtable, Cassiel Ato Forson said the economy was heading towards dangerous terrain.

The suspected VAT increase also evoked mixed feelings among Ghanaians in the business community. The Ghana Union of Traders Association (GUTA) said it wanted the government to rather widen the tax net rather than further burden those already paying tax.

According to Benjamin Yeboah, the National Welfare chairman of the Ghana Union of Traders Association (GUTA), the introduction of new taxes will be problematic.

“As businesses, we always look for a conducive environment to do our business. So any tax that is problematic for us needs to be looked at. Imposing taxes is not the way to go when you want to raise revenue. The government needs to widen the tax net to bring in more businesses and persons that are not paying taxes. Also looking at our ports of entry, want taxes like the 2% special import levy to be reduced or removed. We’ve also heard that there might be an increase in the VAT at the ports. That will be problematic because it will end up being passed on to ordinary Ghanaians in the form of increased prices.”

Meanwhile, the acting Chairman of Abossey-Okai Spare Parts Dealers, Clement Boateng, in stating his expectation from the budget review said he wanted the government to ensure that any tax measure stabilizes the cedi.

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