Bawumia Promises Lower Tax Regime in Economic Reform Plan
Vice President Dr. Mahamudu Bawumia, the flagbearer of the New Patriotic Party (NPP), has unveiled a comprehensive economic reform plan aimed at transforming Ghana’s economy. Speaking at the party’s manifesto launch in Takoradi on Sunday, Dr. Bawumia emphasized the need for a fundamental shift in economic management, with a focus on private sector involvement, procurement reform, and a complete overhaul of the tax system.
Dr. Bawumia highlighted the importance of reducing the economic burden on the national budget by encouraging greater private sector participation. He proposed that Public-Private Partnership (PPP) concessions could be used to finance, manage, and maintain roads, making it more attractive for private investment in infrastructure.
He also called for a drastic change in the country’s procurement practices to combat waste and corruption, suggesting a shift from outright purchases to leasing goods. “This approach would allow the budget to save significant amounts in cash expenditure annually across various ministries, departments, and agencies,” Dr. Bawumia explained.
A key element of his plan is tax reform. Dr. Bawumia pointed out that an estimated 13% of Ghana’s GDP, or around 150 billion Ghana cedis in 2023, is lost due to individuals and businesses being outside the tax net. To address this, he proposed a simpler, more citizen-friendly, and business-friendly flat tax system, which would be the first major change in the tax structure since Ghana’s independence. The flat tax system would involve a fixed percentage of income for individuals and businesses, with exemption thresholds to protect the poor.
In addition, Dr. Bawumia promised to simplify the complicated corporate tax and VAT systems and to introduce a tax amnesty to provide a fresh start for individuals and businesses. “Our ultimate goal is to move Ghana towards a lower tax regime with broader coverage, stimulating greater economic activity and generating more revenue for the state,” he concluded.
