ISSER urges government to broaden tax base in 2027 budget

The Institute of Statistical, Social and Economic Research (ISSER) has called on the government to prioritize revenue mobilization and the broadening of the tax base in the upcoming 2027 national budget. Speaking at the launch of the 2025 State of the Ghanaian Economy Report, the institute emphasized the need for fiscal discipline that does not rely solely on expenditure cuts but instead focuses on sustainable revenue growth and productive investment. ISSER researchers noted that while fiscal consolidation has improved, with public debt decreasing from 62.7% to 46% of GDP, the government must now focus on reducing revenue leakages and strengthening tax compliance to safeguard social spending.

ISSER Director Professor Robert Darko Osei highlighted that for economic growth to be meaningful, it must translate into tangible job creation and improved living standards for Ghanaians. He advocated for a strategic shift toward manufacturing-led growth and increased agricultural productivity to transform the economy. According to Professor Osei, enhancing the current growth rate by just two percentage points could significantly accelerate the timeline for doubling the nation's GDP per capita, provided that these gains reach the household level and are not restricted to raw material exports.

Addressing the challenges facing the private sector, the report warned that heavy government borrowing continues to pose a risk by potentially crowding out businesses from accessing necessary credit. Professor Fred Dzanku, Head of the Economics Division at ISSER, further cautioned that despite a decline in the inflation rate, many households are still facing severe financial strain. He explained that falling inflation does not equate to lower prices, and because incomes have not kept pace with the rising costs of goods and services, the real cost of living remains a significant hurdle for most citizens.

To ensure long-term stability, ISSER recommended that the government move away from an over-reliance on raw material exports and instead focus on financing the private sector to drive industrialization. The institute concluded that the 2027 budget presents a critical opportunity to align fiscal policy with job-creating sectors, ensuring that the country’s recent macroeconomic gains result in real economic benefits for all citizens.