The country will lose GH¢18.9 billion and GH¢22 billion in revenues this year and 2022 respectively, as a result of the impact of covid-19 on the economy.
Last year, the nation also lost GH¢10.4 billion as revenue due to the coronavirus pandemic
Several sub-sectors of the economy witnessed significant reduction in their Gross Domestic Product growth rates last year, amid the coronavirus pandemic, affecting payment of taxes and levies to government.
This, a Senior Technical Adviser at the Finance Ministry, Dr. Samuel Nii Noi Ashing, says, makes the introduction of some indirect tax measures in the budget necessary.
“This year, GH¢18.9 billion is not going to be available, 2020 about GH¢26 billion and 2023 GH¢44 billion. This is the difficulty that we have, it has devastated activities [economic] and even human beings who are supposed to generate these activities, Dr. Nii Noi Ashong disclosed this at the Ghana National Chamber of Commerce and Industries Joy Business Post Budget Seminar.
“So it’s not just numbers who have been lost, but what they [Ghanaian people] could be doing is also very important”, the astute economist said.
Continuing Dr. Nii Noi Ashong said “If you look at the quarterly growth rates for Ghana in 2020, you realized that there was positive growth in the 4th quarter before covid-19 came. Quarters 1 and 2 contracted and quarter 3 we got some positive growth. But if you look at it by sectors – the oil sector actually ended the year with a negative growth or contraction of 6.2% and it is not far fetch because there was a decline in production as well as prices on the world market.
Furthermore he said “the non-oil sector grew by 1.6% over the course of the year. If you also look at the formal and the informal economy, the informal sector which accounted for 27.4% of national output in 2020 grew by 3.6%; the formal sector stagnated-didn’t grow at all.”
“So you can see why you are not getting your revenues because the informal sector usually, we don’t get enough taxes from them, all the taxes come from the formal sector”, he emphasised.
Last year, the nation lost 10.4 billion cedis as revenue due to the coronavirus pandemic
Resource mobilization and allocation (2021)
Government will this year raise a total revenue and grant of GH¢72.4 billion.
Domestic debt alone is expected to be GH¢70.9 billion, whilst non-oil tax revenue is estimated at GH¢53.6.
For spending, total expenditure is estimated at GH¢113.7 billion in 2021.
Wages and salaries alone is expected to be GH¢25.79 billion.
About GH¢35.8 billion will also be spent on interest costs.
Whilst domestic interest payments is estimated at GH¢28.3 billion, transfer to statutory funds would be GH¢18.08 billion.