A tax analyst, Abdallah Ali-Nakyea bemoaned the government's decision to scrap the toll booth system.

“The question is – even last year, the policy direction was to increase the rate of tolls, so, we can get more to rebuild the infrastructure. So, what changed; which is what I complained about policy inconsistency in the economic front,” he said.

Read the full story originally published on November 22, 2021 by Classfmonline


Tax analyst Abdallah Ali-Nakyea has wondered why the government abolished road tolls and tollbooths when the main reason for having them in the first place was to rake in more revenue for development.

The government announced the scrapping of the tolls to provide a respite to vehicle owners and road users given the heavy vehicular traffic and lengthened travel time such tollbooths cause couple with the ineffective revenue collection at such points on the roads.

This was announced by the Minister of Finance, Mr. Ken Ofori-Atta, in his presentation of the 2022 budget statement and economic policy to parliament on Wednesday, 17 November 2021.

Explaining the rationale behind the scrapping of the road tolls, Mr. Ofori-Atta said the revenue that accrues to the state for the construction and maintenance of roads is inadequate and hence, the government has to look elsewhere to equitably generate revenue for the construction and maintenance of our roads.

“Over the years, the tolling points have led to heavy traffic on our roads and lengthened travel time from one place to another, impacting negatively on time and productivity”.

“The congestion generated at the tolling points, besides creating these inconveniences, also leads to pollution in and around those vicinities”, Mr. Ofori-Atta said.

“To address these challenges, the government has abolished all tolls on public roads and bridges”, he announced.

“This takes effect immediately the Budget is approved”, he noted.

“The toll collection personnel will be reassigned”, he said.

“The expected impact on productivity and reduced environmental pollution will more than offset the revenue forgone by removing the tolls,” he added.

The minister said to compensate for the road tolls, the government is looking to introduce innovative ways of raising revenue such as the proposed 1.7% phone transactions levy payable by mobile money users per transaction above GHS100.

He said this will help the government to shore up revenue inflows to fund road projects in the country.

However, Dr. Ali-Nakyea said in an interview on Accra-based Citi FM on Monday, 22 November 2021: “The question is – even last year, the policy direction was to increase the rate of tolls, so, we can get more to rebuild the infrastructure. So, what changed; which is what I complained about policy inconsistency in the economic front”.

He asked: “If the reason for abolishing the tollbooths to bring e-levy has to do with congestion at the tollbooths, fumes – don’t we even suffer more congestion and fumes in traffic; not even at tollbooths, even in normal traffic?”

“So, even the tollbooths can be relocated instead of being abolished because our towns and cities have grown to outstretch the tollbooths; let’s relocate [them].

“In fact, it will not be the first time of relocating tollbooths: they’ve been moved forward from time immemorial, so, let’s look at that; increase it and I believe the stakeholder discussions that were held, people were all for an increase in tolls because they could see road networks being developed” he noted.

“And, if it is about congestion, we even have some lanes that are e-tickets; then you don’t go and stand there and buy, you go because you are holding it already”.

“Can we then, with digitalisation, go that way so all the toll booths will be digitised or portions will be digitised and people who are regular on that lane get to pay at a point; their system will by input like we have at the University of Ghana, Legon; once you get there, the bar lifts and you are gone”.

Dr. Ali-Nakyea said: “Indeed if the intention is to tax e-commerce, I believe the GRA has developed a framework for the taxation of e-commerce. Did we take that to look at how to implement it or we wanted an easy way out? Because the discussion has been on so many fronts – e-commerce, transfers, MoMo and the question is: even the use of the revenue to help infrastructure and you abolish tollbooths?”

He said: “For me, my worry is the tracing and tracking of the revenue, else it goes into the drain, which is why I keep complaining that if we don’t plug the loopholes and we keep increasing taxes or introducing taxes, they go down the drain because the hole becomes wider”.

“If we are saying 2.8 million people are bearing the tax responsibility of over 30.8 million people, when indeed, statistics show that about 14 million are supposed to be paying tax, doesn’t it presuppose that if we are to double the two million who are bearing the burden to about four, five, even up to 10 million, then our problem is solved? Why don’t we want to go that route to ensure tax compliance and we are looking for shortcuts, easy way out because the very people who are the 2 million, will be burdened the more”.

“If we think that the MoMo is going to widen the tax net, we need to apprise ourselves of the unintended consequences of withdrawals, unintended consequences of going back to the old ways; I’ll go to the bank because you are now telling me bank transfers are not included [so] I’ll go back to old ways [and] transfer through the banks. I’ll endure the queue and the traffic if it will save me that amount because remember it depends on volumes – the higher the amount the higher you are going to be paying, so, with the small ones, I do it and pay”.