Impact Of International Monetary Fund (IMF) Policies On Tax Systems And Gender Equality In Ghana

This study set out to assess the impact of IMF policies on tax systems and gender in Ghana. Starting from a historical standpoint by using the 16th and 17th Extended Credit Facility (ECF) programmes, this technical report provides a critical analysis to address the following research objectives:

• Evaluate the Gendered Impact of Tax Policies: Analyze how IMF-recommended tax
  policies affect men and women differently in terms of economic participation, income
  distribution, and overall well-being.
• Identify stakeholders working or advising the government on gender and tax.
• Assess IMF Advice and Technical Assistance: Investigate the alignment between IMF
  recommendations and gender-sensitive tax reforms in Ghana and map out key actors in
  the advice and
• Examine Surveillance Mechanisms: Assess the adequacy and effectiveness of IMF
  surveillance mechanisms in promoting gender equality and inclusive tax policies in Ghana.

The IMF's role in shaping Ghana's tax policies has been significant, with the institution providing
technical assistance and policy recommendations to broaden the tax base, increase revenue
mobilisation, and improve tax administration. Despite these efforts, concerns have arisen
regarding the distributive effects of these tax reforms, especially regarding gender equality. The
reliance on indirect taxes like VAT has disproportionately burdened lower-income households,
where women are often overrepresented. Additionally, the informal sector, a substantial part of
Ghana's economy, remains largely untaxed, leading to challenges in ensuring that the tax system
is equitable and efficient.

Recognising the importance of gender mainstreaming, the IMF has begun to acknowledge
gender as a macro-critical issue essential for achieving macroeconomic stability and inclusive
growth. However, the practical application of gender-sensitive policies in Ghana remains limited.
The lack of gender-disaggregated data and insufficient gender analysis in policy formulation and
IMF interventions hinder the effective implementation of gender-sensitive tax reforms. There is a
growing need for more concrete and actionable recommendations from the IMF that consider the
unique socio-economic contexts of countries like Ghana to ensure that economic policies do not
unintentionally perpetuate existing inequalities but contribute to gender equity and broader socioeconomic
goals.

Despite some strides in recognising gender as a macro-critical issue, the IMF's programs in Ghana
have lacked a robust gender-sensitive approach. For instance, while the 2015 Extended Credit
Facility (ECF) included discussions on mitigating the adverse social impacts of economic reforms,
there was no clear focus on how these measures affected men and women differently. The 2023
ECF, although introduced after the IMF’s gender strategy was developed, still showed limited
gendered implementation and discussion. The IMF’s focus has remained largely on
macroeconomic indicators, with insufficient attention to the gender-specific impacts of these
policies, thereby missing opportunities to promote inclusive growth that benefits all segments of
the population equitably.

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