The centre for tax analysis in developing countries

Overseas Development Institue Institue for Fiscal Studies

On 20th June 2023, the Ministry of Finance in Ghana, in collaboration with TaxDev, invited stakeholders from government, the private sector, and civil society to an event previewing the findings of two major new collaborative studies.

The first is a comprehensive review of Ghana's VAT system, covering policy, administration and recent revenue performance. Drawing on the principles of tax design, evidence and practice from other countries, and detailed analysis of VAT data and processes in Ghana, this study aims to critically appraise the current system, and contribute to its future development.

The second is a distributional analysis of how the amount of tax paid varies across the Ghanaian population. Analysis of how the tax system affects different parts of the population - such as richer and poorer Ghanaians - is vital to ensure that the tax burden is distributed fairly and progressively. The analysis is undertaken using the GHATAX microsimulation model, which allows the distributional implications of policies to be analysed before they are implemented - contributing to more effective policymaking.

These reports come at an important time for Ghana's tax system, with the preparation of the country's first Medium Term Revenue Strategy (MTRS) now underway. Following presentations by Ministry staff and TaxDev researchers, the Director of the Revenue Policy Division, Mr George Winful, stressed the importance of engaging with this process, which will set the direction of travel for tax and other revenue policies in the years ahead emphasising that "....its success depends both on detailed research and analysis, and input from stakeholders and experts throughout Ghana."

Published on: 26th June 2023

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