Economist Prof Bokpin Denounces Government’s Tax Increases as State-Sponsored Robbery

Renowned economist and Professor of Finance, Prof Godfred A. Bokpin, criticizes the government’s frequent imposition of taxes, labeling it a form of state-sponsored robbery that adversely affects citizens financially.

During an appearance on Newsfile on JoyNews, Prof Bokpin contends that the government’s reliance on taxes is a simplistic and lazy approach to revenue generation, leaving Ghanaians burdened by the unpredictability of newly introduced taxes.

Describing the situation as “state-sponsored robbery” that results in financial repression of citizens, he asserts that such practices should not be tolerated, stating, “I think in Ghana, we have allowed too many wrongs in this country.”

Prof Bokpin emphasizes the need to explore more optimal methods of raising revenue that do not compromise the ability of households to meet their needs and hinder the competitiveness of the private sector.

He challenges the notion that imposing more taxes is the only viable solution and argues that the real impact of increasing taxes on the country’s tax revenue to GDP ratio is not evident.

In addressing the compliance cost to taxpayers, Prof Bokpin points out that the frequent imposition of taxes since 2020 has led to significant costs for taxpayers, involving the continuous reconfiguration of systems every six months, causing a lack of predictability.

The economist advocates for a more strategic approach to revenue generation, urging the government to work harder to generate revenue for the benefit of the people and businesses driving the economy.

He highlights the disruption caused to various sectors, including the banking and manufacturing sectors, due to constant changes in tax policies, emphasizing that such practices do not align with effective taxation.

The government’s recent decision to implement Value Added Tax (VAT) on households exceeding their lifeline power consumption, as directed by Finance Minister Ken Ofori-Atta, has faced criticism. The Trades Union Congress (TUC) Secretary-General, Dr. Yaw Baah, expresses dissatisfaction, particularly with the imposition of a 15% VAT on lifeline electricity consumers, deeming it detrimental to workers’ welfare and signaling a need for opposition until the tax is rescinded.