Question

The government of Ghana through the Minister of Finance presented the 2020 Budget statement to Parliament

in November 2019.The Coronavirus Disease 2019 (COVID -19) pandemic that has hit the world has impacted

on global economy including Ghana, thus affecting our macroeconomic targets in the budget statement

presented in November 2019. The Minister of Finance presented a statement to Parliament on the economic

impact of COVID – 19 pandemic on the economy of Ghana and the way forward at the end of March, 2020.

Discuss five (5) key impact of the COVID-19 on the achievement of our fiscal policy targets for the year 2020

by comparing the original budget statement to the one presented after COVID- 19.

Answer 1

5 key impact of covid-19 on achievement of fiscal policy target for the year 2020 would be-

A. It would be leading to a lower tax collection because there is a lockdown in the entire economy and the tax collection are expected to be lower because of less profit.

B. It would lead to lower allocation of resources as a collection would be lower so the allocation would also be there

C. It would be leading to more tax stimulus by the government as the economy is going through a crisis

D.there would be a proposal of tax deduction becausebecause there is need to stimulate the demand in the overall economy and that would be stimulated by cutting the corporate and individual tax rate

E.there should be adoption of more liberal tax policy and more tax incentive should be proposed through the budget.

These are the flexibility that is to be offered through the new budget.