Business News of Tuesday, 9 February 2021

Source: Bright Dzakah, Contributor

Government must tax lawyers - Economist

The economist argued that lawyers across the country earn enough The economist argued that lawyers across the country earn enough

Government has been charged to include lawyers into the tax bracket if it wants to cover more grounds in the formal sector. This according to an economist Dr. Emmanuel Asamoah, will not only help in expanding the much talked about tax net but also generate more revenue for the state.

The economist argued that lawyers across the country earn some amount of money if not so much and such earnings are not taxed by the state, creating rooms for these lawyers to ‘evade’ tax. Noting that if government is serious about expanding the tax net, one of the areas to explore should be taxing the people in the legal field.

Speaking on ways that government can expand the tax net to avoid overdependence on loans and grants, Dr. Emmanuel Asamoah averred that “I am a lawyer and I can tell you that a lot of lawyers get money on fees [they] charge and they don’t pay tax”

He told Noel Nutsugah host of Statecraft on Zylofon Fm that it is ironical one would expect lawyers to know that paying tax is their legal obligation and abide by it but they would rather arrange their fees in such a way that, they either avoid tax or reduce it. “So, if steps are not put in place to robe in these people, you are likely to lose out on the monies that they will pay to the state in taxes.”

For him, it will be erroneous for government and the tax authorities to assume that they have captured everybody in the formal sector, adding that these are some loopholes that need to be sealed apart from plans to include the informal sector.

“Much as it is good idea to widening the tax net, it is also important topay attention to the fact that there are indeed people in the formal sector that have not been captured. This is not overburdening with taxes but just trying to account for all taxes we need to collect” Dr. Emmanuel Asamoah also suggested that collecting property tax should not be difficult for government since there are many innovating ways to do that, describing it as a “highly formal sector”

In his suggestion, government should be able to tie property tax to the electricity meters in such a way that it is included in the billing system which will prevent evasion of property tax by house owners. He posited that not more than 20% of Ghanaians pay property tax and “should we tie it to the electricity meters for example, I’m sure you cannot avoid paying property tax”

Explaining that the cost of collecting tax will be fairly lower than employing people to go from one house to another.