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NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA

NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA Press Release To All Media Houses *The Gallant Cad...


NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA
NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA

Press Release
To All Media Houses
*The Gallant Cadres of NDC*
0505446753
0241906363


ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET.

The Gallant Cadres of NDC views 2022 Serwaa Broni Budget as a killer one with sole aim of impoverishing the poor Ghanaian taxpayers more.

1. The 2022 budget statement is a killer (“Awudie”) budget that seeks to impose new draconian taxes on Ghanaians, which will only worsen the severe hardships that Ghanaians are already reeling under.

2. Government has increased its tax revenue projection from GHS55 billion for the 2021 fiscal year (with GHS37 billion already collected, as at September 2021) to GHS80 billion in 2022, representing an increase of GHS25 billion in projected tax revenue over a 12 months period.

3. In the killer (Awudie) budget, government is introducing a 1.75% Digital tax (Bawumia Tax) on all electronic transactions (Uber, deliveries, online purchases, ATM services, payment of taxes through digital platforms etc.), momo transactions above 100 cedis, bank transfers and inward remittances – monies sent to Ghanaians by loved ones abroad either for healthcare, school fees, building and all other purposes.

* Government projects to raise GHS7 billion from this inconsiderate Bawumia tax alone in the year 2022.


* What the Bawumia tax means is that, for every GHS1,000 cedis you send through Momo or bank transfer, government will deduct a Bawumia tax of GHS17.50p in addition to the transaction fee of 1% (GHS10) you already pay, leading to a total deduction of GHS27.5.

 Also, for every GHS10,000 cedis bank or Momo transfer, government will deduct a Bawumia tax of GHS175 and so on. This is nothing but pure stealing of the monies of Ghanaians by government and will impose untold hardships on already-burdened Ghanaians. 

The Bawumia tax will be a huge disincentive to the digitalization agenda of the country and send us two decades backwards because it will discourage people from using electronic or digital platforms for their transactions. Ghana is not the first country to introduce this tax; other countries like Uganda, Tanzania etc. have done same with very dire repercussions leading to the reversal of same in Uganda. 


* The Bawumia tax runs contrary to Dr. Bawumia’s own public commentary in the run up to the 2020 general elections (August 2020) on Peace FM that Mobile money will not, and should not be taxed by government because it is used by very poor people. The introduction of Momo tax in the 2022 “Awudie” budget therefore reinforces Bawumia’s place as a confident trickster and indeed, the most deceitful politician in Ghana’s history. 

In this killer budget, government is scrapping the 50% and 30% discounts on the benchmark values of imported goods and vehicles respectively. This will lead to steep increases in import duties on the affected products. 

This means vehicles, pharmaceuticals, sugar, aluminum roofing sheets and products, toilet paper, mosquito coils, ceramic tiles, Portland cement and other building materials, matchet, paper, water, tomato paste and ketchup, furniture, toilet soap and laundry bar soap, lubricants, alcoholic and non-alcoholic beverages, biscuits, pasta, spaghetti, noodles & macaroni, animal products, textile and textile articles, electrical machinery and equipment among others; will go up between 20% to 30% in the coming days. 


These increases on import duties [due to the scrapping of the 50% and 30% discounts on the benchmark values of imported goods and vehicles respectively] which will eventually be passed on to Ghanaians will further escalate prices of general goods and services in the country and worsen the severe hardships Ghanaians are already reeling under. 

* Given the many draconian taxes that have been introduced by the callous Akufo-Addo/Bawumia/NPP government since the introduction of the benchmark value discounts in April 2019, and the continuous depreciation of the Ghana Cedi which is already eroding profit margins and the capital of businesses, importers and Ghanaians in general will be worse off as a result of this decision. In short, already crippling import duties and port charges will be far higher than they were before April 2019 when the benchmark discounts were introduced in the wake of the continuous free fall of the Cedi and the raft of new paralysing tax measures that government has introduced since April 2019. 

* This catastrophic decision has been occasioned by the economic malaise we presently find ourselves in, with our economy in tatters a wasteful government in search of more money. After four (4) years of economic mismanagement and reckless election-driven spending, which have taken the country back to its HIPC days, the Akufo-Addo/Bawumia/NPP government has decided to punish the already-burdened Ghanaian people with more hardships for their own recklessness and mismanagement. This is why all manner of taxes and killer measures are now being imposed to shore up government’s revenue just to create an artificial picture of a sound economy to convince the investor community on more borrowing. 

* This latest decision by Government to reverse discounts in benchmark values of imported goods, further accentuates Dr. Bawumia’s place as a confident trickster and the most deceitful Politician in Ghana’s history. We recall that sometime in the year 2019, Dr. Bawumia was all over pontificating that Ghana's ports were one of most expensive in the sub-region and that government had decided to introduce discounted benchmark values in order to facilitate more trade volumes, make our ports more competitive, reduce smuggling and increase government revenues from the ports. The question that ought to be asked is:

 what has changed in just two years to warrant a reversal of that “brilliant economic policy” by the once economic messiah of the NPP who has now turned himself into an IT champion? Is Ghana no longer interested in facilitating trade volumes and efficiency at the ports? Are we no longer interested in reducing smuggling to optimize revenue at the Ports? Sad how no one takes his words seriously anymore.


* The claim that this decision is intended to support AGI and local manufacturers is completely false. If government were serious about supporting local manufacturing companies, they would have reduced tax payments and other factors of production to bring down the cost of production and the cost of doing business in the country, and not increase the tax burden on businesses like they have done in this killer 2022 budget. 

* In any case, most of the affected goods such as clinker, sugar, vehicles and spare parts etc. are not even manufactured in Ghana. Neither do we have the comparative advantage and local capacity to even produce some of the affected items currently.  

5. In this killer budget, government is increasing all fees and charges of government by 15%. This means that all the fees we pay for government services (DVLA, passport office, Birth & Deaths registry, Registrar General, FDA, Standard Baird etc.) will go up by 15% when approved by Parliament. These harsh revenue measures come at a time when government has already introduced myriads of crippling taxes on the Ghanaian people and businesses such as:

 1% COVID levy on the VAT flat rate, 1% COVID levy on NHIL, 20 pesewas energy sector levy on every liter of diesel and petrol, 18 pesewas energy sector levy on every liter of LPG, 10 pesewas sanitation levy (Borla tax) on every liter of diesel and petrol, 5% financial sector recovery levy on all banks which is passed on to the customers, among others, all in this year 2021 alone. 

* Even before the introduction of these crippling taxes, government had already introduced a 46 pesewas Special Petroleum Tax on every liter of fuel, increased VAT by 5% by making the 2.5% GETFUND levy and 2.5% NHIL straight taxes, as well extended the 2% special import extended beyond 2017 and 5% National fiscal stabilization levy beyond 2017, among others, thereby making them new taxes. 

6. What happened to Dr. Bawumia’s much-vaunted promise to move Ghana from taxation to production? Was he not the one who said in opposition that taxes were hurting the economy? What happened to his promise to raise revenue by increasing production and productivity? What about his claim that taxation is a lazy approach to governance? What a confident trickster Vice President we have. #Bawuliar

7. Ghanaians should not be deceived by the announcement of the abolishment of road tolls as same is yet another deception by the dishonest Akufo-Addo/Bawumia/NPP government. Vehicle owners will pay 15% more in Roadworthy certificate fees and other vehicular-related taxes when they go to the DVLA as a result of the 15% increase in fees and charges of government. 



* In any case, scrapping the payment of road tolls of 50 pesewas and 1 cedis by vehicle owners who are relatively well to do, while at the same time, slapping them and non-vehicle owners with the above draconian tax measures will not bring about any significant improvement in the lives of Ghanaians but, will rather worsen living conditions. 

8. Government has indicated in the Killer (Awudie) budget that they intend to take over the collection of property taxes from the MMDAs, assign same to a private company, who will retain 30% of all collections, with government and the local assemblies retaining 30% and 40% of revenues collected respectively. This PDS-like arrangement which is yet another avenue for the family and friends of President Akufo-Addo to create, loot and share state resources, will weaken our already weak local assemblies financially and further suppress development at the local level. This is because Property Tax is one of the major sources of revenue for local assemblies and taking that from them, will weaken their capacity to undertake development projects for the benefit of their communities. 

9. Note that all these draconian tax measures are being introduced at the time Public sector workers have been given a paltry 4% increase in their salaries while inflation is hovering around 11%. This means Ghanaian workers are increasingly being impoverished by this government, as was recently noted by the Catholic Bishop Conference. 

10. What is most worrying however, is the fact that the Akufo-Addo/Bawumia/NPP government is the most resourced government in Ghana’s history with very little to show, yet they keep slapping Ghanaians with crippling taxes without any consideration. 


* It is instructive to note that, whereas the Mahama administration got total tax revenue of GHS86 billion in 4 years, this government got over GHS157 billion in tax revenue during their first 4 years in office (2017-2020)

* Whereas the Mahama administration added GHS84 billion to the country’s Public debt, and both the Mills and Mahama administration added about 110 billion to the Public debt in 8 long years, the Akufo-Add/Bawumia/NPP government has added GHS221 to our Public debt in only 4 and half years

* Again, whereas the Mahama administration benefited from oil revenue from just one (1) oil field with oil production of about 70,000 barrels per day and total oil revenue receipts at about GHS6 billion,

 the Akufo-Add/Bawumia/NPP government has benefited from three (3) oil fields with oil production of about 200,000 barrels per day and total oil revenue receipts at about GHS20 billion. For this year, 2021 alone, government projected oil revenue of GHS3.6 billion but has raked in GHS4.3 already as at September 2021, thereby making windfall profit of over GHS700 million in oil revenue alone. 

* Overall, the total resource envelope that accrued to the Mahama administration in 4 years was GHS194 billion, while that of the Akufo-Add/Bawumia/NPP government is over GHS400 billion.

The problem however is that despite being the most resourced government, they have wasted all the revenue that has accrued to them on election-related consumption expenses, corruption and profligacy. 

11. The killer (Awudie) budget does not address the sorry state of our economy, particularly, our unsustainable Public debt and unprecedented budget deficit. According to the finance minister, the public debt which stood at GHS120 billion in December 2016, has as at September 2021 reached GHS343 billion. This means this government has added 221 billion to our public debt in just about 5 years with very little to show. And Debt to GDP ratio has moved from 56% in 2016 to a staggering 80% in 2021. Public debt is projected to hit GHS350 billion by December 2021 with debt to GDP at 82%. Today, every Ghanaian owes over GHS11,000 cedis due to the unbridled and reckless borrowing of this government.

 Our terrible Budget deficit that stood at 15.6% in 2020, has only declined to 12.5% as at September 2021. This further reinforces our long-held view that it is the financial indiscipline and reckless expenditures of this government that has brought us to the financial cul de sac we presently find ourselves in and not COVID, as Government would have us believe. 

* Currently, the debt servicing burden for 2021 stands at GHS51 billion (interest payment and amortization) representing 92% of tax revenue. In fact, when the debt servicing amount of GHS51 billion is deducted from our projected total revenue of GHS72 billion, the remainder of GH21 billion is not enough to pay the salaries of public sector workers which is about GHS30 billion. Government has to borrow for the payment of public sector workers, goods and services, CAPEX, statutory funds and all other things. Our economy is in shambles owing to the recklessness, cluelessness and crass economic mismanagement of Dr. Bawumia. 

* To make matters worse, in the killer budget, government yet again intends to borrow an additional GHS37 billion in 2022 and another GHS4.5 billion in the international bond market, which will further increase our unsustainable debt and debt servicing burden. 

12. The killer (“Awudie”) budget does not address our ever-depreciating cedi. The cedi is trading at GHS 6.35 to a dollar from GHS 3.92 at end 2016. It also exchanges at GHS 8.46 against the British pound and GHS 7.28 against the Euro thereby eroding the profit margins of businesses and leading to steep increases in fuel prices, food prices and the prices of general goods. The exchange rate is really exposing the weak fundamentals of our economy. 

13. The budget does not address the problem of high unemployment the nation is currently faced with. All the talk about building an entrepreneurial nation is an empty rhetoric and an admission that government has totally failed and given up on its promise to create jobs. 

* Aside the rehash of the usual sloganeering and empty rhetorics and deceptive promises, no concrete measures were outlined in the budget to create sustainable jobs for the teeming unemployed youth. The phasing out of NABCO beneficiaries has exposed government’s grand deception to make NABCO beneficiaries permanent government workers.

The so-called YouStart initiative is yet another empty slogan just like their much-touted Obaatanpa cares program that has turned out as a pipe dream. At best, just a few of their party apparatchiks will benefit from these cosmetic schemes, without addressing the critical problem of high unemployment facing the country. 

* The budget does not address the problem of high cost of doing business and high cost of production confronting businesses in the country. The private sector cannot be expected to create jobs when government keeps imposing crippling taxes on businesses and Ghanaians in general.

This Statement was made before they comes to power. But now see what happens to this promised. # Dishonest Vice President
This Statement was made before they comes to power. But now see what happens to this promised. # Dishonest Vice President

14. As always, it would come as no surprise to us for government apologists including Dr. Bawumia himself to once again seek to canvass the COVID-19 pandemic as a convenient excuse for the new draconian tax measures and bad policies in the 2022 budget statement. These days, the inept and clueless Akufo-Addo/Bawumia/NPP government blames literally every single thing on COVID-19, including when the sun fails to appear. 

* However, it is important to state forcefully that COVID-19 can never be blamed for the reversal of benchmark values. This is because, government exceeded its revenue target for 2020 (COVID year) and actually raked in more revenue than they did before COVID struck. For instance, in the year 2019 before the advent of COVID-19, total tax revenue stood at just about GHS43 billion, while total tax revenue for 2020 (covid-year) stood at GHS45.3 billion, exceeding government’s tax revenue target for 2020 by a whopping GHS2.5 billion. In addition to this and by courtesy of the coronavirus pandemic, government has received support of about GHS34 billion from external sources. 


This includes support of US$2 billion from the IMF, a US$100 million grant from the World Bank, US$200 million from the Stabilization Fund, about GHS20 billion from the Central Bank, among others, all of which have been squandered on hyper-inflated consumption-related expenditures such as $100 million (600 million cedis) on the procurement of hand sanitizers, face masks and Veronica buckets for the reopening of Senior High Schools in 2021. Therefore, the claim about a revenue shortfall of GHS11 billion as a result of COVID is no excuse for where we are as a country today. 

* It is worthy of note that, several countries in the sub-region like Togo, Benin, Nigeria, Ivory Coast, among others, have better budget deficit, debt to GDP ratio and other economic indices than Ghana despite being also hit by the COVID pandemic. Therefore, COVID-19 cannot be a reasonable justification for the imposition of unprecedented hardships and misery on Ghanaians by this government. On the contrary, it is down to crass economic mismanagement spurred by a toxic combination of unbridled borrowing and reckless spending on misplaced priorities that have brought us here.


15. The killer (Awudie) budget does not address the misplaced priorities.
* According to the 2020 Auditor General’s report, financial irregularities in the Public sector has risen astronomically from GHS718 million in 2016 to GHS12.8 billion in 2020 under the watch of Bawumia and Akufo-Addo. 

* Also, According to PIAC, about GHS2 billion of Ghana’s oils revenue from 2017-2020 cannot be accounted for. 

* Even more bizarre is the fact that, in the midst of unprecedented hardships and the imposition of draconian taxes on already-impoverished Ghanaians, government is thinking of building a new Parliamentary Chamber and purchasing two (2) new Presidential Jets. 

* This government has shown that it has no intentions of applying tax resources to cushion the ordinary Ghanaians. A typical example that illustrates this point is Government’s refusal to use receipts from the stabilization and recovery levy on fuel totaling about GHS4 billion since 2017, to subsidize fuel prices. 

* It is an insult to the sensibilities of Ghanaians for government to waste all the unprecedented revenue that have accrued to them on corruption and wasteful expenditures, only to turn around to punish Ghanaians further for government’s own mismanagement by imposing crippling taxes on Ghanaians. 


16. The budget doesn’t address the problem of huge arrears and debts totaling GHS30 billion owed by government to contractors. 

17. What is most sad and bizarre about the 2022 Killer (Awudie) budget is that it made no mention or provision or reference whatsoever to the devastating tidal waves that has destroyed many homes and displaced over 4000 people in Keta, Anlo areas in the volta region. Neither was any provision made for the continuation of Phase 2 of Keta Sea Defense project. 

This is despite the firm assurance we were given by the minister of works and housing that the 2022 budget was going to address the problem. Yet, not even a mention was made on this sad disaster that has affected thousands of Ghanaians. Till date, the President has not commented or commiserated with the affected communities. This deliberate omission on the part of government underscores their insensitivity and disrespect for the people of the Volta region and must be condemned in no uncertain terms. 


18. In conclusion, investors in Ghana’s bonds have reacted to the budget by increasing their yields (interest). Simply put, they do not have confidence that this government can raise revenue by GHS25 billion in one year to make us able to meet our debt service obligations. This is evidence of loss of confidence in our economy by investors and the zero policy credibility of the Akufo-Addo/Bawumia government.

* Ghanaians have had enough of the deception and callousness of the Akufo-Addo/Bawumia/NPP government. The NDC through its 137 MPs in Parliament will do all we can to block these killer taxes and bad policies in the “Awudie budget”. As President Mahama said in his #ThankGhana address, this is not the time for more taxes but rather, the judicious use of taxes collected by cutting down on needless and wasteful expenditures. 

* It is about time we came together as a people irrespective of our social backgrounds or political affiliations to resist these draconian measures of the failed Akufo-Addo/Bawumia/NPP government which will only worsen our living conditions should they be allowed to stand. Enough is Enough!


In all this, let’s not forget that tax exemptions to foreign multinational companies ranges between GHS3 billion to GHS5 billion per annum. Yet government seeks to take from our pockets, Momo and bank account GHS7 billion in 2022 through the 1.75% Bawumia tax.

Comrade Richard E A Sarpong, Father Casford
The PRO and Convener 0241906363

..


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www.EweGhana.Net

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EweGhana.Net Inspiring Our Culture: NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA
NDC PRESS RELEASE: ALL YOU NEED TO KNOW ABOUT THE SERWAA BRONI KILLER BUDGET - EWE GHANA
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