The Chair in Tax Law at Leeds University in the United Kingdom added that “tax is at the centre of what we are as societies; without taxes, there will be no roads, no police, there will be nothing”.

“Everything that we have constructed in the world is built on this very basic concept of pooling. We all contribute so that we all live better and in the process, we protect those that have the least,” she said.

Prof. Feria, who was delivering a lecture as part of activities marking the 2024 Tax Conference in Accra, further said that taxes were the lifeblood of every nation, however, there was the need for governments to implement tax policies and systems that would not make people worse off.

The public lecture, which formed part of the 12th annual international tax conference by the Chartered Institute of Taxation, Ghana (CITG), was on the topic: “Tax myth”.

It was organised by CITG, in collaboration with the University of Professional Studies, Accra (UPSA) Law School.

Tax myths

Prof. Feria demystified certain myths about taxation such as the saying that there was a perfect tax system, that if a country was facing challenges they needed to tax the citizens more to address those problems, with some saying there was no need for tax.

She said there was nothing like a perfect tax system, rather, a good tax system must find equilibrium in the tenets of taxation which included equity or fairness, efficiency and administrative ease.

Prof. Feria also said there could never be a tax system that was completely fair, because what one might think constituted fairness in actual fact was not fairness in relationship to taxation.

For instance, she said people might argue that the scrapping or reduction of taxes on sanitary pad might be fair to consumers, especially the poor, to help promote gender equity, but if such a tax system was not carefully scrutinised before implementation, it might end up rather enriching companies that produced the sanitary pads, instead of the final consumer.

Situation

Prof. Feria further said that it was fundamentally wrong for governments to think that imposition of more taxes alone could resolve challenges.

Oftentimes, she said, tax policymakers thought that taxing the rich more would help address inequality, or increasing taxes on processed food and sugar would reduce obesity.

“People want taxes to be paid but they do not want it coming from them. If you cannot define the rich you cannot tax the rich,” the expert added.

On the myth that taxes were not important, Prof. Feria described such mindset as unfortunate, because taxes were a means through which development projects were funded.

She said without taxes, many people, including the vulnerable would not have access to public services.

Importance

The Head of Tax Audit of the Ghana Revenue Authority (GRA), Dr Martin Yamborigya, said despite its importance, people still believed taxes were necessary.

“Taxes, when properly collected and managed, can really propel economic growth,” he added.

For his part, the President of CITG, George Ohene Kwatia, said people had lost faith in taxation because instead of expanding the tax net, people who pay their taxes regularly were rather those who were constantly audited and harassed by tax authorities.