VAT is a lazy approach to generating revenue – ISODEC

Dr Steve Manteaw ISODEC

The Integrated Social Development Centre (ISODEC) has accused the government of adopting a “lazy approach” to rake in revenue for the government.

Parliament has approved the controversial 17.5% Special Petroleum Tax bill, hoping to generate about GHc1.5 billion by the end of the year.

ISODEC’s Campaign Coordinator, Dr. Steven Manteaw in an interview on Eyewitness News stated that falling on the Value Added Tax (VAT) “is the laziest thing that you can think of.”

He described VAT as a “regressive tax” which makes “both the rich and the poor pay same.”

The Minister explained that the bill will help the government rake in more revenue from the oil and gas sector.

But Dr. Manteaw said the bill “is an unfortunate and a lazy approach to identifying potential sources of revenue to finance our budget.”

He pointed out that “if it’s 17.5%, whether you are rich or poor, you pay the same rate but I believe there is a certain thinking in government that fuel is bought by only the rich.”

According to him, there is a wrong perception in the public domain that it is only the rich who own vehicles “but please, there are many poor people who have taken loans to purchase vehicles.”

“They have done it because it is a necessity because of the absence of an efficient public transport system, and that is what compels many people. Many people would ride on buses if we had decent ones around and more efficient,” he added.

Dr. Manteaw therefore indicated that for government to target fuel for VAT “smacks of some laziness on the part of government because it’s a soft spot; it’s the easiest to target and this will have adverse effects in terms of its translation into higher prices of some petroleum products.”

source : citifmonline.com