Bawumia’s flat tax system promise is a scam for political power – Importers & Exporters say

For years, importers have voiced concerns over high port charges, urging the government to provide relief. Recently, comments by Dr. Mahamudu Bawumia, the NPP’s flagbearer, have sparked debate among industry experts and economic analysts regarding the practicality and fairness of his proposed flat tax system aimed at reforming Ghana’s tax structure.

During a stop at Suame Magazine in Kumasi on his Ashanti region tour, Dr. Bawumia spoke to spare parts dealers about the prevalent issues with the current tax system. He introduced his plan for a flat tax system, likening it to the church tithe where everyone pays a uniform percentage.

“Ghana, our tax system is problematic just as the businessmen are complaining. So, I want to introduce a new tax system. This new tax system is called the flat tax system which is like the tithe you pay in church. If it is 10%, it is 10% for everyone. So, by 2025, we are going to begin the implementation of a new flat tax system for Ghana,” said Dr. Bawumia.

He further promised, “We will cut off every tax the GRA would have made you pay in 2025 so that we all start from ground zero. Tax amnesty in 2025.”

However, industry figures like Sampson Asaki Awingobit, Executive Secretary of the Importers and Exporters Association, have criticized Dr. Bawumia’s remarks as politically motivated. Awingobit argued, “This is not the first time the vice president has made sweet statements. Coming from the vice president, I think it is a total scam. He just wants to sway us.”

Awingobit expressed skepticism about the feasibility of the plan, citing Ghana’s commitments under the ECOWAS Common External Tariff (CET) and the IMF program with its associated conditionalities. “There is no way he is going to do anything to reduce revenue for the government,” he asserted.

He also suggested that there are alternative ways to alleviate the burdens faced by importers that the NPP flagbearer has overlooked.

Tax policy analyst Geoffrey Ocansey offered a mixed perspective on the proposal, acknowledging potential short-term benefits but warning of adverse long-term consequences. “It is a regressive approach to your economy. You are flooding your market with foreign products, your local industry will be crippled, people will lose their jobs, and government revenue will eventually shrink,” Ocansey said.

Ocansey also highlighted the regressive nature of the proposed tax system, predicting it would create disparities among importers and disrupt economic balance.

Source: InsiderGH.com