In an effort to protect the public purse and save the country from paying huge interest on judgement debts, the Attorney-General and Minister of Justice, Mr Godfred Dame has proposed an amendment to the Contracts Act, 1960 (Act 25).
When passed by Parliament into law, he said, it would disallow the payment of compound interest by the state in transactions entered into on her behalf by public officers.
"This urgent amendment to the Contracts Act will explicitly forbid a public officer from entering into a contract on behalf of the State and stating the rate of interest to be compound interest. This will prohibit the occurrence of the situation which called for the Supreme Court's intervention and save the State enormous income which can be utilised for development," Mr Dame said at the Annual Conference of the Ghana Bar Association at Bolgatanga on Monday.
This year's conference which was attended by President Nana Addo Dankwa Akuffo-Addo and the Chief Justice, Justice Kwasi Anin Yeboah was on the theme: "Ensuring an increase in revenue mobilisation through taxation for the purpose of accelerated national development: the role of the lawyer."
The Attorney-General said the state's purse was grossly affected by the award of judgment debts in various unconscionable transactions whereby the state was ordered to pay huge compound interest on debts accruing from transactions entered into on her behalf by public officers whose primary duty is to protect the public interest.
Mr Dame recalled the recent example of a financial house claiming payment of over GH¢1.3 billion, from a transaction involving a meagre GH¢268,000, even after the state had already paid over GH¢79 Million, simply because the agreed rate of interest was compound interest.
It took the intervention of the Supreme Court in exercise of its inherent jurisdiction, pursuant to an application by the Attorney-General to declare further payment as unlawful.
Touching on the theme, Mr Dame entreated lawyers to honour their tax obligation and suggested the bar should as part of the criteria for publication of lawyers in good standing every year, require evidence of fulfilment of tax obligations.
He conceded that the failure of lawyers in Ghana to discharge their full tax obligations is not entirely their fault.
Mr Dame noted that the absence of effective systems by the Ghana Revenue Authority (GRA) to ensure that all potential tax payers are brought into the tax net is majorly responsible.
He said the GRA ought to devise the appropriate mechanisms for ensuring that the tax net is broadened to its elastic limit in order to bring within it all potential tax payers including all practising lawyers.
The Attorney-General said another part the lawyer ought to play in ensuring an effective revenue mobilisation was by aiding other taxpayers to know their tax obligations and not to fall short of the law.
Mr Dame told the participants that President recognised the importance of industrialisation as a source of revenue for development and embarked on the One-District One-Factory, One-Village One-Dame project to provide jobs to Ghanaians.
The Attorney-General said he was concerned at the unhealthy practice where some lawyers denigrate the judiciary in the media when cases were not decided in their favour.
He warned that such misconduct only undermines public confidence in the judiciary and advised lawyers to desist from that.