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Business News of Sunday, 22 March 2020

Source: theindependentghana.com

Throw the 2020 budget out of the window – Joe Jackson


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The Director of Business Operations of Dalex Finance has urged Parliament and the Government to throw out the 2020 budget and its fiscal constraints to provide a stimulus package to mitigate the grim effects of the Coronavirus pandemic.

In a discussion panel on TV3 ‘Key Points’ hosted by Abena Tabi, Joe Jackson described the current situation as a national emergency.

The economic analyst, noted for his blunt assertions, advanced the following argument:

“Ghana is in a health crisis caused by the Coronavirus pandemic. The Government is right in instituting a ‘Restricted Regime’ to help reduce infection by the Coronavirus and ensure public health safety. The ‘Restricted Regime’ has induced a massive slowdown of the economy that has the potential to cause an economic crisis.”

“The negative effects of the coronavirus on multiple sectors including the Government Revenues, Remittances, Hospitality Industry, Education, etc., will require a significant stimulus package to mitigate the dire effect of this slowdown on the informal, and, economically vulnerable persons of our society. The Ghanaian economy is already struggling to trickle down the ‘favourable’ macroeconomic benefits to these same persons. The public budget is also labouring under severe pressure due to high-interest payments, bloated salaries and wages, and, poor revenue collection.”

Joe Jackson said “… we have to go back to the drawing board. All the assumptions have changed. We need a ‘war’ budget. This is about survival. We can only get the size of the stimulus package required if we throw out the 2020 budget and its fiscal constraints. Otherwise, the economic crisis will last for long after the Coronavirus has been brought under control.”

He further suggested that part of the stimulus package for the crisis could include:

Reduce VAT.

Return SSF and PAYE deductions to payees.

Suspend the communications tax to reduce the cost of voice and data.

Remove fuel taxes to reduce the price of transportation, food, etc.

Extend National Health Insurance to cover all illnesses.

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