An open letter to the president of the Republic of Ghana

Dear H.E Akufo-Addo,

Let me take this opportunity to wish you and your family a happy and prosperous New Year and also to profess my profound admiration for your courage and conviction in pursuing your presidential dreams in the midst of adversities and disappointments.

A couple of years ago, before you were elected as the president, I was on a flight from New York to Miami and seated next to me was a lovely old French lady who purportedly was your neighbor in Paris in the 70s. We found ourselves talking on the journey, and she recalled a moment when she had returned from work to see you packing out of your flat/house. You confidently told her then that you were moving back to Ghana to prepare yourself to take up the presidency.

You told your neighbor your presidential dreams in the 70s, and it’s amazing how you managed to bring this long-cherished dream of yours into fruition against all odds and under persistent and vehement opposition both within your party and the opposition parties. Well done Sir. You are an inspiration to me.



Sir, I am writing this letter to you as a fellow Ghanaian to express my views on the taxation policy of our country, particularly on the impending imposition of the E-levy.

When it comes to the introduction of new taxes or tax reforms, Senator Russell Long couldn’t be far from the truth with his definition of tax reforms being “Don’t tax you, don’t tax me. Tax the guy behind the tree.”

We all don’t like taxes, especially new taxes. Most of us believe there’s that guy out there who always has to empty his pocket on our behalf to build that road, hospital etc. that we need as citizens. The reality check is there might be no guy behind the tree.

Ultimately, the responsibility lies on us the citizens to kick in the money for the good roads, hospitals etc. Research has proven that most of the time responsible citizens wouldn’t mind paying their due provided the tax satisfies the long-cherished ideals in the realm of taxation, particularly those pertaining to the promotion of social and economic equity and justice.

Since the introduction of VAT which you vehemently protested against, never before has tax caused so much political and social chaos in this country. The government economists in their single-minded pursuit of raising revenue to finance the budget have failed to look at the broader picture, and they have thrown out of the window the canons of a good tax as far as the E levy is concerned.



The E-levy could be likened to the poll tax that was introduced in the UK by Thatcher’s government in the 90s which was seen as the biggest political misjudgment of her government. This tax led to the ignominious end of Margaret Thatcher and it is my prayer that this E levy wouldn’t lead to the end of your government.

The pensioner Mr. WE Jones and his wife accused the then Prime Minister Margaret Thatcher of being uncaring in their letter sent to her on 3rd March 1990 which partly read, “you have taken advantage of your position to impose your will upon us to the point where you are virtually a Dictator riding roughshod over anyone who opposes you”.

Like Mr. Jones and his wife, many Ghanaians are disgruntled by the resolve and the unanimity among your members of parliament to impose this levy on us without the slightest critical scrutiny or skepticism.

This levy is not only economically inefficient, but a lazy approach on the part of your government to raise revenue (I say this with all due respect). Again with many livelihoods hit by the pandemic, it will be insensitive now on the part of the government to introduce any tax that will significantly affect poor households and individuals.

It is an undeniable fact, there are a lot of pressures on you to raise revenue to deal with the public finance of the country particularly now when we need better healthcare, a comprehensive social safety net, financing of our elevated public debt as well as the budget deficit.

I can assure you that your government has plenty of options to raise additional revenues without inflicting much pain on a majority of its citizens.

Like the Malaysian government announced in its 2022 budget and also as Gordon Brown did in 1997, there is an opportunity to introduce windfall taxes for high-income companies and those who have profited from the pandemic. The Gold mining companies are typical examples considering the soaring gold prices over the past years.

Windfall taxes are economically efficient because it’s one-off and based on past profits and does lead to little unintended distortions in economic behavior. It is also administratively feasible because it will be based on a simple formula applied to the readily available information.

Other areas of taxation to explore and expand are stamp duty and capital gains tax. Considering the booming real estate sector and the volume of transactions it presents and also real estate being one of the key methods of hoarding wealth, stringent regulation ensuring proper data collection of these transactions present another great avenue of raising money to finance the budget.

Also, there have been major acquisitions of key multinational companies in Ghana in the past years and the tax laws clearly state that capital gains liability arises when the underlying interest of an asset changes but sadly none of these companies including Ghana Manganese Company, Prestea Mines, and Bogoso Mines have been pursued to even declare the considerations that were even paid for these natural resources of the Ghanaian people.

Deliberately as a way of avoiding or evading this tax most of these acquisitions are done at the group level meaning the shareholders of the Ghanaian subsidiary will remain the same but that of the group will change. This shouldn’t stop the tax authorities from pursuing these companies for the taxes due because whether the takeover is done at the group or the subsidiary level, the underlying interest has changed and therefore capital gains liability arises.

Sir, why do we even give our mining concessions out for just 10% free carry interest? There are better alternatives which I will address another day.

The fetish of imposing this E levy at the cost of neglect of the above taxes which can bring in more revenue in a less painful way clearly demonstrates a missing piece of a puzzle in our tax policy as a country.

Sir, although not an easy route to choose, but what we require now is structural tax reform. With this pandemic and the economy, we have now, it is critical that we look at options that allow us to raise taxes in a less damaging way.