Ghana's struggles with tax revenue leakages will be substantially reduced through technology integration and data synchronisation across government agencies, experts at a University of Professional Studies, Accra (UPSA)’s National Dialogue have said.
The panel, which featured specialists from academia, tax practice and the mining sector, unanimously endorsed technology as the solution to the country's persistent revenue collection challenges.
"Technology is the way to go," a tax expert and Associate Professor at the University of Ghana School of Law, Abdallah Ali-Nakyea, said.
“The Ghana Revenue Authority (GRA) has done very well with automation, making it very easy to file your returns online and get your tax clearance. One key area is how to let our network speak to other institutions," Prof. Ali-Nakyea, who is also a Director of Ali-Nakyea & Associates, stated.
The country loses approximately GH¢6 billion annually through various forms of revenue leakages, according to figures cited during the discussion.
The sum includes GH¢3 billion lost to corruption, GH¢2 billion loss from the mining sector, and additional losses from transfer pricing and customs undervaluation.
Prof. Ali-Nakyea highlighted that those losses far exceeded the $3 billion International Monetary Fund (IMF) bailout, which was spread over three years.
"Do we need the IMF," he questioned, suggesting that Ghana could be financially self-sufficient if the leakages were properly addressed through technological interventions.
Forum
Other panel members included Mining Governance and Development Impact Specialist from the Kwame Nkrumah University of Science and Technology (KNUST) Business School, Dr Richard K. Boso; an Associate Professor at UG School of Law, Professor Kwame Gyan, and a Senior Manager of Tax and Regulation at Deloitte, Gilbert Yirenkyi Addo.
Before the panel discussion, a Senior Lecturer at UPSA, Dr Eric Boachie Yiadom, presented a compelling case for technology's efficacy, drawing on the demonstrable results of Strategic Mobilisation Ghana Ltd (SML) in the petroleum sector.
Chaired by the Ga Mantse and President of the Ga Traditional Council, King Tackie Teiko Tsuru II, the dialogue, championed by the Faculty of Accounting and Finance, received insightful contributions from former President John Agyekum Kufuor, a former Minister of Finance and Member of Parliament for Karaga, Dr Mohammed Amin Adam, and a Deputy Commissioner of the GRA, Elsie Appau.
Cross-referencing data
A key recommendation from the panel was the cross-referencing of financial data among government agencies.
"If somebody is out there driving a vehicle imported with $3 million, what is the duty paid?
The $3 million value card represents income.
When we link up GRA with the Driver and Vehicle Licensing Authority, that's a big one," Prof. Ali-Nakyea pointed out.
The panel also explored how technology could help capture revenue from the informal sector, describing it as the second shadow to the income tax act due to the presumptive tax.
Prof. Ali-Nakyea suggested that getting each player in the informal sector to pay GH¢20 a day through mobile money would yield much in 90 days, and would be their quota.
The Senior Manager of Tax and Regulation at Deloitte emphasised the importance of data synchronisation.
"One thing we need to improve is data synchronisation.
People file their financials and if you pick reports, you notice that they have filed different reports to GRA, and different reports to other institutions.
This should not happen. There should be a centralised point for financial data," Mr Yirenkyi Addo said.
Dr Boso of KNUST Business School emphasised the need for future contracts should include provisions for capacity building, stating that "they should have a situation where the nation's own capacity is improved just by the contract."
“The losses we are seeing annually are not just numbers.
They represent classrooms unbuilt, medicines not purchased, and the dreams of our young people deferred.
Every cedi lost is a missed opportunity to change someone’s life,” the development impact specialist emphasised.
Prof. Gyan, who is also the Head of Chambers at Kwame Gyan & Associates, connected technological solutions to broader governance issues.
"Our problem goes way beyond economics," he stated, suggesting that technology implementation must be accompanied by integrity reforms.
The experts noted that while GRA had made progress with automation, more comprehensive integration was needed.
The immediate past Finance Minister argued that technology held the key to plugging revenue gaps and transforming tax compliance across the country.
"We also advanced a comprehensive digitalisation drive to streamline tax administration and reduce the heavy dependence on human interventions.
That created opportunities for living.
This is what we call a traceless tax system. When we remove the human element from routine tax processes, we minimise corruption and maximise compliance,” Dr Amin Adam said.
He pointed to the proliferation of fragmented information technology solutions within the GRA as a core challenge.
"Our country has seen too many tax reforms, implemented too many tax handles.
Our tax authority, GRA, has deployed the highest number of software products in Ghana for tax purposes — the last count, 20 software products.
“And GRA, as we know, is one of the biggest institutions of employment.
Notwithstanding all this, our tax system exhibits evidence of low tax elasticity," Dr Amin Adam pointed out and stressed coordinated, data-driven innovations.
SML example
For his part, Dr Yiadom referenced SML’s technology's efficiency in the petroleum sector.
"We have, historically, had discrepancies in the revenue reporting between the lifting volumes and the taxable volumes by the National Petroleum Authority (NPA) and GRA," he stated.
The UPSA Senior Lecturer explained that before the engagement of SML in May 2020, there was a discrepancy of about 3.2 billion litres.
However, after SML’s engagement, within four months, that figure dropped to 260 million litres — a reduction of 91.9 per cent.
He described SML's real-time surveillance and reconciliation systems as akin to placing a “second eye” on petroleum flows, much like an internal auditor in corporate governance.
The firm deploys ultrasonic flow meters, AI-powered surveillance, and automated reconciliation, providing a crucial independent verification layer to data from the NPA.
Dr Yiadom, therefore, urged stakeholders to focus on outcomes rather than "speculative or politically tinged narratives," especially in light of public criticisms and findings from third-party audits.
He also defended SML's risk-reward payment model, arguing for its fiscal prudence for the government, explaining that under the structure, the company bore all investment costs and was compensated solely on performance.
"If your performance does not bring any addition, you will get zero, and all the investment will go to zero.
The government will not have to pay a dime for the investment made by the company," Dr Yiadom pointed out.
Supporting the view, Director of Support Services at SML Ghana, Dr Yaa Serwaa Sarpong, provided concrete figures, saying SML’s centralised data platform had seen reported monthly taxable fuel volumes rise from an average of 208 million litres to 450 million litres per month.
Between May 2020 and December 2024, 14.1 billion litres of previously unreported fuel were captured, generating over GH¢20 billion in additional tax revenue.
"The implication is that GRA can meet its annual target even before the deadline, whereas, before SML’s operations, GRA struggled to achieve this,” Dr Sarpong noted.
Dean
The urgency for the technological and systemic reforms is underlined by Ghana's staggering revenue losses as illustrated in an analysis presented by the Dean of the Faculty of Accounting and Finance, UPSA, Prof. Isaac Boadi, which revealed that the nation lost approximately $9.02 billion annually, equivalent to six times the annual cost of the flagship Free Senior High School programme and nearly five times the National Health Insurance Scheme’s budget.
The GRA alone is estimated to forgo around $3 billion every year —30 per cent of its potential collections — due to illicit financial flows and loopholes exploited by high-net-worth individuals and foreign firms.
Customs-related corruption, including under-invoicing and port malpractices, account for an additional $515 million, as per a 2023 World Bank report.
Prof. Boadi mentioned others as $2 billion loss in taxes and royalties from gold in 2022, an estimated 60 per cent of small-scale mining operations evading taxes, with the oil and gas sector contributing a further $1.5 billion in unaccounted-for revenues in 2023.
While GRA has made strides in automation, panellists stressed that more comprehensive integration was essential.
The country's domestic revenue collection rose from GH¢75 billion in 2022 to GH¢104 billion last year.
Source: GraphicOnline
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