Govt’s plan to use Tax Refunds for revenue ‘absurd’ – Ampaabeng

Former Deputy Finance Minister Dr. Alex Ampaabeng has strongly opposed the government’s proposal to tap into funds from the Tax Refund Account as a revenue source, describing the move as “absurd” and unsustainable.

His criticism comes in response to Finance Minister Dr. Cassiel Ato Forson’s statement during the presentation of the 2025 budget. Dr. Forson revealed that Ghana’s Tax Refund Account had accumulated GH¢29.1 billion over the past eight years, with GH¢12 billion disbursed for tax refunds, leaving a balance of GH¢16 billion. He suggested that these funds could be utilized to support government revenue.

Speaking on the OXFAM Tax Dialogue on Channel One TV, Dr. Ampaabeng dismissed the idea, emphasizing that tax refunds are not independent revenue sources. He explained that businesses in Ghana prepay taxes in quarterly installments, often leading to overpayments. The law mandates that 6 percent of total tax payments be set aside for refunds, ensuring that businesses are reimbursed when they overpay.

“The tax refund account is not money sitting somewhere aside from government revenue. If you say you are going to rely on the tax refund account to bridge the revenue gap, it is like expecting money to come from nowhere,” Dr. Ampaabeng argued.

His remarks highlight broader concerns over the government’s fiscal strategies, calling for more sustainable revenue-generation policies rather than short-term fixes.