Economist, Professor Godfred Bokpin has urged the government to rethink its approach to taxation, emphasising that taxes should not be seen solely as a tool for revenue generation but as an enabler for economic growth and business development.
Speaking on Channel One TV on Tuesdays, March 11, 2025, Prof. Bokpin expressed concerns about the current tax mix, stating that additional taxes have not significantly improved tax buoyancy.
Instead, he noted a trend of “tax substitution,” where new taxes merely replace existing ones without increasing overall revenue efficiency.
Prof. Bokpin cautioned against overburdening the “faithful few” – businesses and households that consistently bear the brunt of tax policies.
He stressed that the government should focus on deploying effective tax handles that promote economic activity rather than stifle it.
“If you look at that mixture of the tax handles that we have deployed, and you access the overall buoyancy of those taxes, these additional taxes necessarily have not increased our tax buoyancy. What is happening within the tax mix is that we are experiencing some level of tax substitution. But at the end of the day, what we should be looking at is the effective tax handle that we should deploy such that in our attempt to generate more revenue, we don’t burden the faithful few.
Because typically, tax is not just an instrument to raise revenue. Often times in our part of the world, we think that tax is a hammer. If you view tax as a hammer then you treat everything around as a nail for you to nail them. So, we are nailing businesses, households and others. But tax is an enabler to promote businesses, consumption,” he stated.
