Accra, Nov. 23, GNA - Dr Larbi Siaw, Director of Tax Policy Unit of the Ministry of Finance and Economic Planning, said on Monday that the increases in taxes presented in the 2011 budget would not in anyway cause untold hardships to the citizenry.

"We will get through our difficulties with the taxes. It would not bring future hardship," he said, and called for the widening of the tax net because if the wage bill was going up there must be a corresponding increase in revenue.

Dr Siaw said this at a day's workshop for parliamentary correspondents on the dissemination of the 2011 budget statement and economic policy in Accra.

He explained that when the tax base was expanded and more revenue was accrued, Government could increase salaries but said the mere fact that the nation was earning tax revenue did not mean everybody's pay would be increased.

Dr Siaw said some zero rated items including pharmaceutical products, and paper for the publishing industry would be reclassified as exempt items. He added that there would be a 20 per cent environmental tax on plastic packaging and products, excluding bottled water which already attracted excise duty and proposed to reduce the ad valorem rate by 2.5 per cent of all excisable goods except on spirit and cigarette.

He explained that the government proposes an upward adjustment to the current debt recovery levy to retire the Tema Oil Refinery (TOR) debt and its effect on the banking system.

Dr Siaw noted that the exemption list would be reviewed, adding that special permit was now abolished across board, except for government imports.

Mrs Efe Simpson Ekuban, Chief Director at the Ministry of Finance, said the purpose of the workshop was to assist members of the press corps to dialogue with the framers of the budget for a clear understanding of the issues when they are being debated in parliament.

She said it was also to seek a positive image of the government economic performance as had been presented in the budget. Mr Samuel P. Kyei, Director of Budget at the Finance Ministruy, giving the overview of the budget, said the expectation by the public that the country would get big revenue from the oil exploitation was not the case as it was noted in the budget that about 584 million dollars would be expected for the start.

He noted that the single spine salary scheme, arrears from 2009, and judgment debt were some of the challenges facing the 2011 budget. 23 Nov 10