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Osei Kyei Mensah Bonsu reading the 2021 Budget Statement in Parliament on Friday, March 12.
Total Income and donations for 2021 are projected to increase to GH ¢ 72,452 million, equivalent to 16.7 percent of Gross Domestic Product (GDP), compared to a result of GH ¢ 55,132 million, equivalent to 14.3 percent of GDP registered in 2020.
National Income is estimated at GH ¢ 70,987 million in 2021 and represents an annual growth of 31.7 percent over the result registered for 2020.
The Minister of Parliamentary Affairs, Osei Kyei-Mensah-Bonsu, who presented the 2021 Budget Statement to Parliament, said that the total Internal Revenue and Non-Oil Taxes would constitute about 74 percent, for an amount of GH ¢ 53,632 million .
This equates to 12.4 percent of GDP, reflecting the impact of expected improvements in tax compliance and revenue management reforms.
The theme of the 2020 Budget was: “Consolidation, Completion and Continuation”, subtitled “W0N YA WO HI33” Budget, that is, “we are moving forward”.
Kyei-Mensah-Bonsu said the government recognized that as a result of the impact of COVID-19, times were difficult for many people, yet it was important for the government to rebuild and strengthen public finances to provide the necessary resources to protect lives. and livelihoods, provide critical government services, support the transformation of the economy, and ensure fiscal and debt sustainability.
“We have to do this ourselves, as no one will do it for us,” he added.
He said that rebuilding the country’s public finances required the implementation of some important fiscal measures to mobilize additional domestic revenue.
On tax administration, the minister said that in 2021 the Ghana Revenue Authority (GRA) would intensify audits and institute measures to recover all outstanding debts and enforce collections in the extractive industry.
He said a study of the downstream oil sector indicated that the challenge of underreporting and tax evasion by some industry players still existed.
The Minister said that the GRA together with the relevant agencies will mount a campaign to confront the illegal acts.
On gaming policy, he said that games had become a major source of income throughout the world and an important source of revenue for the government.
Kyei-Mensah-Bonsu said the influx of online gambling and the automation of the once entirely manual process had changed the character of the industry’s revenue streams.
“It is estimated that Ghana loses more than GH ¢ 300 million annually in revenue due to leakage in the sector,” he said.
The minister said the finance and interior ministries would jointly oversee the gaming industry and would soon consult with stakeholders to formulate a comprehensive policy to improve the mobilization of revenue from that source.
For the support of Covid-19, he said that the government in 2020 outlined a series of initiatives to cushion the effect of the pandemic on the population.
However, some sectors of the economy and sectors of the population continued to suffer the devastating consequences of the disease, Kyei-Mensah-Bonsu said.
He said that, therefore, the government was implementing additional relief for different sectors of the population, especially those most affected by the pandemic.
Allowances include tax rebates, tax stamps, and vehicle income tax.
He said that the beneficiaries of the tax breaks would have to be registered with the GRA and must have fulfilled their first-quarter tax obligations.
The Minister said that for the allocation of resources for 2021, Total Expenditure (including settlement of arrears) was projected at GH ¢ 113,750 million, equivalent to 26.2 percent of GDP for 2021.
“This represents a growth of 13.7 percent above the yield of GH ¢ 100,052 million registered in 2020,” he said.
Kyei-Mensa-Bonsu said that wages and salaries were projected to amount to GH ¢ 25,799 million and constituted 22.7 percent of total spending (including settlement of arrears) by 2021.
As a percentage of GDP, the wage bill is projected to be 5.9 percent in 2021 compared to 6.5 percent in 2020.
The use of goods and services is also projected at GH ¢ 5,967 million or 1.4 percent of GDP, which represents 5.2 percent of total projected spending (including settlement of arrears).
He said that interest payments are projected at GH ¢ 35,864 million, equivalent to 8.3 percent of GDP in 2021, and of the amount, internal interest payments would constitute about 79.1 percent, for an amount of GH ¢ 28,368 million.
Transfers to legal funds, as well as to all other funds assigned, are estimated at ¢ 18,081 million GH (4.2 percent of GDP), which represents a growth of 52.2 percent with respect to the registered result. by 2020.
Capital spending is projected at GH ¢ 11,423 million (2.6 percent of GDP) in 2021, a decrease of 5.5 percent compared to the 2020 result and from this amount, the national financed capital spending is estimated in GH ¢ 3,310 million (0.8 percent of GDP).
An amount of GH ¢ 8,112 million had been estimated for Capital Expenditures with Foreign Financing and that would be financed with a combination of Grants and Loans for Projects, said the Minister.
