Economist and Associate Professor at the Institute of Statistical, Social, and Economic Research (ISSER), Prof. Charles Ackah, has highlighted the substantial revenue potential that the Greater Accra region holds.

He made the revelation while emphasizing the need for a more ambitious approach to property tax collection.

Prof. Ackah expressed his views during a special discussion on Joy Business with the theme "Ghana's High Tax Regime: Causes and Remedies."

As per data from the Ghana Statistical Service, there are approximately GH¢8.5 million completed residential structures in Ghana, with 1.7 million of them located in Accra. Notably, the Greater Accra region accounts for roughly 21% of all completed residential structures in the country.

Currently, the Ghana Revenue Authority and municipal assemblies have set a goal of generating approximately ¢165 million from property tax across the country.

However, Prof. Ackah contends that this target lacks ambition, especially when considering the revenue potential of the Greater Accra region alone.

“If you do the analysis and you decide to raise GH¢165 million target in Accra alone, divide 165 million by the structures in Accra and each property is likely to pay just about 97 a year. This means that the target is quite low.”

“According to my analysis, we could raise as much as GH¢12 billion in property taxes alone. So property tax holds a huge potential to boost the country’s tax revenues. Even if we focus on high-earned communities and the increasing luxury real estate, we can do more”, he added.

He further called for a more accountable way of setting revenue targets with constant monitoring from the legislature.

“What we need to do is to mandate parliament to set revenue targets and apply punitive measures for failure to meet targets.”

Prof. Ackah also emphasized that the sluggish growth of Ghana's economy plays a pivotal role in the country's relatively low tax revenue. He pointed out that as the economy experiences more substantial growth and becomes more formally structured, the government's capacity to broaden the tax base also increases.

The GDP-to-tax ratio, as a metric, gauges the proportion of tax revenue collected over a specific period in relation to a nation's total GDP. It is worth noting that research findings suggest that countries with higher GDP per capita often exhibit lower tax revenues. This phenomenon is closely linked to the size and robustness of the economy, as it directly influences effective tax compliance and collection.