As Ghana continues its search for innovative ways to raise revenue, critical decisions about taxation loom large over the political and economic landscape. Among these are the E-Levy and the recently implemented Betting Tax, two policies that have sparked intense debate about fairness, economic growth, and political trust.

For the section of the Ghanaian public suggesting that President Mahama retain the E-Levy, the question is: at what cost? Have they carefully considered the political and social repercussions of such a decision? The E-Levy, introduced by the NPP administration, was a lightning rod for public outrage, seen by many as a regressive tax that disproportionately burdened the poor and stifled digital financial inclusion. It was also a pivotal campaign issue in the December 2024 elections, with Mahama’s promise to scrap it resonating deeply with voters and contributing significantly to his victory.

To renege on this promise would not only cast doubt on his integrity but could also erode the goodwill and trust that buoyed his empathetic victory. In Ghana’s current political dispensation, failing to deliver on campaign promises is akin to political suicide. The discerning Ghanaian voter has little tolerance for broken promises, as the NPP’s own experience in the 2024 elections demonstrated.

The E-Levy was initially projected to raise significant revenue, but its actual performance fell far below expectations, highlighting its inefficiencies. Instead of urging the NDC government to retain this unpopular tax, stakeholders should focus on exploring alternative revenue-generating mechanisms that are more equitable and economically sustainable. For instance, enhancing tax compliance and broadening the tax base by formalizing the informal sector could yield substantial revenue without imposing undue burdens on citizens. Additionally, optimizing property tax collection, which remains underutilized, could provide a steady stream of income for local governments.

The Betting Tax, another contentious revenue measure, poses its own set of challenges. While taxing the burgeoning betting industry might seem logical, it risks alienating the youth—a demographic that played a critical role in the NDC’s victory. More dangerously, there has been little public scrutiny of whether the NDC intends to maintain this tax, a silence that could become deafening if Mahama’s government opts to keep it. Retaining the Betting Tax could prove even more politically toxic than the E-Levy, given its potential to exacerbate unemployment and social discontent among the very demographic the government seeks to uplift.

To avoid falling into the same trap as the NPP, the NDC must demonstrate fiscal creativity. Policies that stimulate economic growth and create jobs will not only expand the tax base but also ensure that the government’s revenue needs are met without overburdening the populace. For instance, investing in sectors like agriculture and manufacturing, which have high potential for value addition and employment, could significantly boost revenue through increased productivity and export earnings.

In the broader context, Ghana’s reliance on consumption taxes like the E-Levy and Betting Tax underscores a deeper structural issue: the need for a more diversified and resilient economy. Reducing dependency on such taxes requires long-term reforms, including improving the efficiency of public spending and tackling corruption to ensure that every cedi collected is put to good use.

Ultimately, any attempt by the NDC to retain the Betting Tax or E-Levy would be a betrayal of the trust Ghanaians placed in them. It would signal that campaign promises are mere rhetoric, devoid of accountability or genuine intent. For the NDC, the stakes couldn’t be higher: deliver on your promises or risk political oblivion in 2028. For Ghanaians, the message is clear: hold your leaders accountable, for the cost of broken promises is far too great to bear.

The path forward requires both courage and creativity. Ghana can raise the revenue it needs without resorting to unpopular and regressive taxes. The question is whether the NDC has the political will to chart a new course or whether it will repeat the mistakes of its predecessors.

Source: The Dot News