Patrick Boamah Petitions Finance Ministry Over ‘Revenue-Penalty Trap’ in Tax Law
Okaikwei Central MP urges urgent reforms, warning high interest rates and enforcement practices risk eroding taxpayer trust and stifling business growth in Ghana
Patrick Yaw Boamah, MP for Okaikwei Central, has petitioned the Finance Minister regarding urgent structural and operational issues in applying interest and penalty rules under the Revenue Administration Act, 2016 (Act 915). The legislator called for swift policy and legislative reforms to resolve these issues.
Speaking to journalists at Parliament House in Accra, Mr. Boamah, Chair of the Subsidiary Legislation Committee, acknowledged that while Act 915 modernized Ghana’s tax system and enhanced the GRA’s compliance enforcement, its implementation has led to unforeseen problems.
He warned that the current interest and penalty framework could undermine taxpayer trust, harm economic productivity, and reduce voluntary compliance. He identified three main provisions contributing to a “Revenue-Penalty Trap’: high interest rates up to 125% of the Bank of Ghana’s rate, monthly interest compounding, and retrospective interest application from the original tax due date. When combined with prolonged audit periods and assessments issued years late, taxpayers often face liabilities far exceeding the initial tax. In many cases, accumulated interest and penalties become overly burdensome for companies.
Mr. Boamah also expressed concern about misuse by some tax officers, alleging that certain officials harass and covertly extort money from struggling firms. He emphasized that such practices damage Ghana’s tax system integrity and deter investment and growth.
He called on the Finance Ministry to review the interest and penalty policies under Act 915 to promote fairness, transparency, and sustainability in tax administration.
