Government implements measures to rake in revenue
Finance Minister Seth Terkper, said on Monday government is implementing measures to generate additional revenue, control expenditures and improve the efficiency in public spending to ensure the achievement of fiscal and macroeconomic targets.
Speaking at a press conference, Mr Terkper said the measures include the re-introduction of the five per cent National Fiscal Stabilisation Levy on the profits before tax of selected companies such as Banks, Insurance companies, Non-Bank Financial institutions, Breweries, Mining, Tobacco and Communication companies.
Others are imposition of 1-2 per cent levy on imports; re-imposition of import duty of 20 per cent and VAT of 15 per cent on mobile handsets and Environmental tax of 5 per cent of the ex-factory price of selected plastics and plastic products.
He said in addition to these revenue policy measures, Revenue administration measures such as field monitoring, audits of top 100 companies, debt recovery, and compliance enforcement to improve revenue efficiency are being intensified.
Besides, there are ongoing discussions with the country’s development partners on disbursement of Budget support pledges.
He said on the expenditure side, government was pursuing measures, including refinancing of debt, to reduce the domestic interest cost, through substitution of short term debt with high interest rates with medium to long term low rate debt.
There are also plans for more regular adjustment of utility prices to cost recovery levels to ensure that budgetary limits are maintained and to ensure that the negotiations for wage increases do not go beyond the budget target.
In addition, there is continuation of moratorium on the award of new contracts by all Ministries, Departments and Agencies, with a view to clearing the pipeline of commitments as well as revision of cash and budget ceilings for all MDAs for 2013 to reflect the cash flow.
The Minister said the Eurobond issue is consistent with Government’s objective of implementing programmes and activities to achieve fiscal consolidation while maintaining growth and debt sustainability in 2013, and reducing the cost of borrowing.
He said the indicative utilization of the 2013 Eurobond has been identified, including counterpart funding for projects already approved, $103 million and Capital expenditures in the 2013 Budget Statement with priority given to self-financing projects, $284 million.
The other areas of commitment are refinancing of maturing domestic debt to reduce the cost of borrowing for which an amount of $363 million would be earmarked and partial and gradual redemption of the Ghana 2017 Eurobond with a provision of $250 million.