Dr Arthur Kennedy warns tax cuts could impact negatively on economy

Political analyst and former New Patriotic Party (NPP) presidential aspirant, Dr Arthur Kobina Kennedy, has cautioned that the National Democratic Congress (NDC)’s plan to abolish multiple taxes, including the E-Levy and COVID-19 tax, could severely harm Ghana’s fragile economy unless alternative revenue sources are identified.

Speaking on JoyNews’ Newsfile on Saturday, March 8, 2025, Dr Kennedy warned that removing these taxes would leave a revenue gap of approximately GH₵96 billion ($8 billion).

He questioned how the government intends to manage this shortfall while claiming the economy is in distress.

“If the economy is in intensive care, how do you remove these taxes without a clear plan to replace the lost revenue?” he asked.

The NDC pledged to scrap what it calls “nuisance taxes” if it won the 2024 elections, arguing that they impose an unfair burden on Ghanaians. However, Dr Kennedy stressed that while tax relief may be popular, government spending must be backed by sustainable revenue streams.

Dr Kennedy criticised successive governments for failing to take decisive action on economic challenges, noting that Ghana repeatedly revisits the same issues without implementing real solutions.

“The problem with Ghana is that we refuse to call things by their proper names. We keep talking and making promises, but we don’t act,” he said.

He pointed out that discussions at the recent National Economic Dialogue sounded similar to past forums such as the 2014 Senchi Consensus, yet little had changed.

“We’ve had endless dialogues, but what have we done? If nothing changes, we will keep having the same conversations 10 years from now,” he noted.

Dr Kennedy also blamed poor governance and corruption for Ghana’s deepening economic troubles, arguing that no real progress can be made without tackling corruption head-on.

“What are we doing about corruption? When was the last time a president fired a cabinet minister for corruption? When did Parliament refuse to approve a ministry’s budget because audits revealed mismanagement?” he asked.

He maintained that unless corruption is dealt with decisively, the economy will remain unstable regardless of policy changes.

Addressing the performance of state-owned enterprises (SOEs), Dr Kennedy criticised their persistent losses despite long-standing recommendations for reforms.

“For 25 years, we’ve had reports from the World Bank and others detailing how to fix our SOEs, but nothing has changed. We keep appointing people based on party loyalty rather than competence,” he stated.

He warned that without bold reforms, Ghana will continue funnelling public funds into failing SOEs without seeing any real improvement.