Business News of Wednesday, 30 October 2024

Source: classfmonline.com

ISSER supports flat rate tax system to boost compliance

File photo File photo

The Institute of Statistical, Social and Economic Research (ISSER) has recommended further research into implementing a flat rate tax for businesses, marking a potential shift in Ghana's approach to revenue generation.

In its recently published State of the Ghanaian Economy Report 2023 and Q3 2024 Review, ISSER suggests that a simplified tax structure could streamline compliance, ease administrative burdens on businesses, and potentially improve tax collection.

The recommendation aligns with a broader tax reform proposal from New Patriotic Party presidential candidate Dr Mahamudu Bawumia, who advocates a flat rate tax as a central component of his vision for a business-friendly tax system.

“There is also a need for research on a flat rate tax for businesses,” ISSER said in its report, underscoring the potential of a simplified structure to facilitate greater voluntary compliance, especially among small and medium-sized enterprises (SMEs).

The institute contends that Ghana’s complex tax framework may be impeding compliance and hindering revenue generation.

Dr Bawumia’s tax reform strategy goes further, proposing not only a flat rate tax but also a tax amnesty and the elimination of unpopular levies, including the e-levy and betting tax.

These changes, he argues, would foster a more streamlined tax regime, aimed at stimulating private sector growth and drawing in investment.

ISSER’s call for research highlights its commitment to evidence-based solutions in addressing Ghana’s revenue challenges.

A shift toward a flat rate tax, the institute suggests, could reduce compliance costs for businesses and improve collection rates, providing a steady and sustainable revenue stream to bolster national development.

Dr Bawumia’s proposal to cut down the number of tax types, which he claims have strained both businesses and citizens, reflects a growing push to reform Ghana's tax policies to better support economic growth.

Watch the latest edition of BizHeadlines below:





Click here to follow the GhanaWeb Business WhatsApp channel