Avoid Banking Uncertainty – Gov’t Told
A lecturer at the Department of Finance, Central University Business School, Mr Benjamin Amoah has called on government to design the country’s budget in such a way that it will not suppress the growth of indigenous businesses.
According to him, the country’s budgets, over the past years, have focused on taxing the business community, without offering them any packages to support their operations.
Delivering a report put together by the University titled ‘A Recapitalised Banking Sector a New Breeze for Value Creation’, Mr Amoah proposed that financial education should be added to the curriculum at the pre-tertiary level.
He was responding to the recent mid-year supplementary budget announced by the government in Parliament .
The Minister of Finance, Mr Ken Ofori-Atta, presented the 2019 mid-year budget review to Parliament, during which he proposed that the tax on luxury vehicles be waived, while the Energy Sector Levy (ESLA) and the Communications Service Tax (CST) be increased.
“The government proposes to increase the Energy Sector Levy by 20 pesewas per litre for petrol and diesel and eight pesewas per kilogramme for Liquefied Petroleum Gas (LPG), so as to increase the inflows to enable the government to issue additional bonds to honour our energy sector debt obligations,” Mr Ofori-Atta indicated.
He also proposed that the CST should be increased from six to nine per cent.
Reacting to the announcement, Mr Amoah said the research department of the University was surprised that the government used the occasion to announce new taxes when it should rather have come out with packages to support business operators.
He said most local businesses were having a tough time sustaining their operations, let alone make profit, adding that it was unfair that the government, in the face of all those challenges, would still increase taxes.
”What we intended to do was to provide an academic insight into the recent development taking place in the banking Industry using research to support what is happening. And we did this looking at indications such as the interest income from banks both loans and non-loan interest income among others.” he indicated.
According to him, importance of financial literacy cannot be understated as it will help reduce the incidence and gravity of malfeasance (fraudulent schemes among others ) in the sector.
Outlining some ways the government could use to reduce cost efficiency, Mr Amoah said management of banks should look at where they are sourcing their input from and how much they are paying for input prices.
”We also expect that, going forward the Industry becomes more competitive. Managers of various banks should think of how best they can deploy the excess funds which have come IN by way of increase in the minimum capital” he added.
He further underscores money as the denominator of all economic activities and as such a decent level of literacy will only go to aid individuals in understanding how to use and manage their resources efficiently.
Based on the research, several banks were rewarded. GCB Bank was awarded the Most Efficient Bank -2018.
Barclays Bank – The Best Intermediating Bank 2018 and Barclay’s Bank won the Overall Best Bank 2018.