The Financial Statement and Economic Policy for the year ending December, 2023 was introduced to Parliament on Thursday by the Finance Minister, Ken Ofori-Atta.
Here are 5 take methods from the 2023 budget.
- Hiring freeze for civil and public servants
The government, as a part of measures to scale back expenditure, will not be using any civil or public servants in 2023.
The Finance Minister Ken Ofori-Atta said the “hiring freeze for civil and public servants” fashioned a part of cabinet directives on expenditure measures in the harsh financial occasions.
Although the policy was introduced as emanating from Cabinet, it’s little doubt a part of the International Monetary Fund’s (IMF) circumstances for enrolling the country unto a programme after the sharp financial slum.
The John Mahama administration succumbed to an identical policy by-product from the Bretton Woods establishment when the country enrolled unto a $1billion IMF programme in 2015.
- MoMo transactions will cost extra
The controversial E-Levy has been slashed from 1.5% to 1%.
This is just not going to ease customers’ ache of utilizing digital fee platforms.
On the opposite, low-income shoppers will pay extra to use MoMo and other E-payment services as the government seeks to legalise scrapping the GH¢100 every day threshold.
Mr Ofori-Atta said the government seeks to achieve this with the 2023 budget, however shoppers took to social media to decry the government for already implementing the policy.
- Cost of manufacturing to improve with elevated VAT
The Akufo-Addo administration, in its first time period elevated Value Added Tax (VAT) by the again door by separating the NHIL and GETFund elements.
This elevated the cost of doing business and consequently led to value will increase.
Now, the base fee of the Value Added Tax could be elevated by 2.5% ought to the budget be authorized. This would transfer the fee from 12.5% to 15%, with many pointing to the hypocrisy of President Akufo-Addo, having been one in every of the leaders of an indication against the VAT, in 1995, as an opposition leader.
- Restriction on V8s important or beauty?
The government can be limiting the use of V8 automobiles by its officers aside from cross country journeys.
This can be touted as a method of chopping prices.
The effectiveness of that is uncertain. It slightly seems populist with the rising public outcry against the use of that luxurious automobile.
Officials are nonetheless at will to use other 4WDs which eat gas as a lot as the V8 engines do.
- The Politics — huge parliamentary loss a risk
Essentially, the 2023 budget will do little to ease the burden on taxpayers and majority of the workforce who’re at the backside of the financial food chain.
The politics of it may additionally sting.
A showdown is anticipated in Parliament when debate on the policy doc begins.
The 2022 budget noticed an amazing battle which noticed friction between the Speaker, Alban Bagbin and the First Deputy Speaker, Joe Osei-Owusu who’s MP for Bekwai, NPP.
Mr. Osei-Owusu, in Bagbin’s absence, reversed the resolution of the Speaker to block the budget, a transfer which prompted controversy in the House for weeks.
If that budget was described by NDC legislators as onerous, the 2023 doc will face fiercer actions.
The capriciousness of some 98 NPP Members of Parliament may additionally cost them greater than they bargained for.
The MPs, claiming to stand by the folks, requested for the resignation of the Finance Minister for main the country into disaster however have since modified that position for the second time now.
They promised to boycott the budget studying ought to Akufo-Addo not yield to their calls for to relieve the Minister of his position however they made a U-turn, got here again to the authentic position after which reversed their resolution again, succumbing to pressure from the party.
If their constituents resolve to vote on issues, they may endure the destiny of the Labour Party in UK the place Tories gained in hardline Labour constituencies in 2018 after the Labour Party unreasonably halted government motion amid Brexit negotiations which prompted the snap election.
Briefly, the 2023 budget, if authorized, is unlikely to scale back pressure on the ‘average Ghanaian’ except robust political steps like chopping government measurement are applied.
VAT and the burdensome MoMo Tax should additionally go whereas the depreciation of the cedi have to be halted alongside other interventions resembling arresting gas value hikes.
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