The Ghana Chamber of Telecommunications is advocating for a more digitized approach towards the payment of taxes in the informal sector.

According to Chief Executive of the chamber, Ken Ashigbey, the move would be advantageous in widening the tax net in the country.

“The challenge in Ghana is that there are a lot more people who are outside the tax net. Because of that, our tax rate is quite high. It is those in the formal sector who pay their PAYE but most of those in the informal sector who make a lot more money do not pay their taxes,” Ashigbey told Citi Business News.

He continued, “That’s why government’s digital strategy is so important. Not only would it make the tax collection efficient and ensure that all the loopholes that exist can be cut off but it also can spread the tax net so that we can reduce the incidence of taxation, get a few more people into the tax net and get more money for people.”

Meanwhile, Ghana’s informal sector which contributes 70 percent of Gross Domestic Product (GDP) to the economy has remained one of the biggest challenges for the Ghana Revenue Authority when it comes to tax collection.

For Ghana to be self-sufficient, it has to broaden its tax base by extending the net from the formal to the informal sector to support ongoing projects.