Ghana’s Tax Mistake – Less On Cars, More On Telecoms

Ghana has just made a mistake with their taxation system. They’ve decided to abolish the supplementary tax on luxury cars while increasing the tax on telecoms services. Nope, wrong way to do it:

The government has increased the Communication Service Tax to nine per cent from the initial six per cent. Finance Minister, Ken Ofori-Atta, announced the increment in parliament on Monday, 29 July 2019 when he presented the mid-year budget review statement.

Mr Ofori-Atta told the lawmakers that: “The Communication Service Tax (CST) was introduced in 2008 at an ad valorem rate of six per cent.

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Today’s Gross Ignorance Award Goes To Samanth Subramanian On Fair Trade

The correct view to have of fair trade – as it is described by progressives – is a minority interest that raises consumer utility so not only why not but it’s a lovely thing. Because raising consumer utility, as perceived by the consumer, is the point of this whole having an economy thing. Everyone thinks their lives are made better by buying from those they prefer to buy from. Few of us would knowingly buy from those still employing chattel slavery.…

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What An Interesting Banking Situation In Ghana – Yes, It’s Politics

We do have to warn that our information source here is more than only slightly partial. But it does hang together, does make sense. Further, it does so in a manner that an independent number which is publicly known accords with the analysis.

So, how does a government get to buy lots of votes without pissing off the World Bank, IMF and so on, the people who are largely paying the government’s bills? The answer being to do the spending to buy the votes then not pay the bills for the spending.…

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What’s Wrong With Ghana’s Economy – Only 2% Of Employment Is In Formal Sector

We may or may not want to take as precisely accurate this estimate of the employment in Ghana’s formal economy – only 2%. This is, note, the percentage of the those entering the labor market each year, not the average over all age cohorts. But if this is anything like accurate, to within even an order of magnitude, then we can easily diagnose what is wrong with Ghana’s economy. Wages are too high, regulation and taxation of business is too great.…

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There’s A Simple Answer To The Church Donation Effect On The Ghanaian Cedi

That simple answer being to have a futures market. For any regular price movement will be arbitraged and thus disappear. That does, of course, depend upon the fact that there is this regular effect. And, as with hundred dollar bills lying upon the ground, that it will means we’re not so sure the effect exists:

Churches are partly to blame for cedi fall – Dr Frimpong

Hmm, well. How’s that?

A senior economic advisor to the vice-president of Ghana, Dr.

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Ghana’s Databank Could Be All Sorts Of Things But It’s Not Menzgold

A claim that Databank is the next Menzgold and that therefore the authorities should move in and take it over to protect depositors’ funds. Hey, it’s possible that there’s something dodgy about Databank and it’s even possible that there are problems there. But that’s very different from saying that it’s a Ponzi scheme like Menzgold. We’d politely suggest that the member of parliament complaining about this is less than fully informed.

Despite explanations advanced by management of Databank that there is no cause for worry by depositors whose funds are with the financial institution, the Member of Parliament (MP) for Bolgatanga Central, Hon Isaac Adongo thinks otherwise and envisages its challenges are akin to a similar incident surrounding the infamous Menzgold scandal.

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Foreign Aid Doesn’t Work – Ghana’s Takoradi-3 Thermal Plant

The idea that we richer people should help those poorer than us seems morally sound. It’s even economically sound as a basic theory – we’re capital rich and they’re capital poor. That’s what it means to be rich and poor really. So, we can invest in their economies and we gain higher returns on our capital. They also gain as the gains from the output of the new production plants are vastly greater than the profits flowing back our way.…

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Aluminium Might Not Be The Right Export Industry For Ghana

It’s entirely true that Ghana has substantial bauxite reserves and it’s equally true that economic wealth is built by moving up the value chain, not just being an exporter of raw materials. However, that doesn’t mean that processing that bauxite into aluminium is quite the right way for Ghana to develop. Yes, this despite the obvious fact that this is what the government proposes, this is what Presdent Akufo-Addo is asking be done.

It’s entirely true that bauxite is pretty cheap stuff yet can be locally processed into alumina and that revenue can make a difference.…

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Maurice Ampaw’s Menzgold Car – EOCO Is Right, That’s Not How Ponzis Are Cleaned Up

The lawyer Maurice Ampaw has an interesting claim as to why he shouldn’t have to give back the Toyota Land Cruiser he got from Menzgold. He was an investor in the Ponzi scheme and therefore this is just him gaining his own money back. Except that’s not how we clean up Ponzi schemes. No one is, in legal terms, a preferred creditor. So, Ampaw doesn’t get paid back in full while everyone else has to wait and or get paid out small amounts on their investments.…

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Of Course Ghana Can Eliminate Corruption – Just Make It Not Worth It

The Attorney General has said that it would be impossible to eliminate corruption in Ghana. If we mean completely eliminate then yes, of course, we humans never manage to completely eliminate anything other than dodos. But if we mean get rid of it to the level where it’s simply not a problem, not something we even note any more, then yes, that’s entirely possible. The trick is to make it not worth being corrupt. Either reduce the rewards or increase the punishments until we get to that point.…

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