Member of Parliament for Tano North Constituency in the Bono Region, Dr Gideon Boako, is cautioning the Mahama government against introducing alternative taxes in disguise following their promise to scrap the Electronic Levy (E-Levy) and betting taxes, 

Speaking to the media on Monday, 13 January, following the vetting of Finance Minister nominee Dr Cassiel Ato Forson, Dr Boako emphasised the potential implications of such a policy shift.

During his vetting, Dr Ato Forson revealed that the Mahama administration plans to abolish the E-Levy and betting taxes in its first budget. 

However, Dr Boako criticised the approach, stating that it could result in significant revenue shortfalls that the government would struggle to address. 

He argued that such shortfalls would conflict with the requirements of the International Monetary Fund (IMF), which demands robust revenue generation to meet debt servicing obligations.

“I think by and large, he [Ato Forson] has done his part, but unfortunately, it wasn’t enough,” Dr Boako stated.

“For instance, he was asked how he plans to make up for the revenue shortfalls from scrapping the taxes, and he said he would cut expenditure.

However, cutting expenditure does not address the problem because the IMF focuses on debt service to revenue ratio, not debt service to expenditure ratio.”

Dr Boako further explained that while expenditure cuts might offer temporary relief, they do not resolve the fundamental issue of generating enough revenue to match debt servicing obligations. 

He warned that the IMF would ultimately insist on finding new sources of revenue, which could lead to the introduction of additional taxes. 

“We don’t want a situation where you give with the right hand and take with the left hand,” he remarked, urging policymakers to consider the long-term impact of their decisions.

The Tano North MP called for a more comprehensive approach to addressing Ghana’s fiscal challenges. 

He cautioned against creating false hope by abolishing taxes only to replace them with alternative levies, urging the government to be transparent and pragmatic in managing the country’s revenue needs.