The Value Added Tax Ratio should be at about 22 percent penetration rather than the current 11 percent according to the Minister of Finance, Mr Ken Ofori-Atta. This statement was made at an industry forum organised by the Ghana Revenue Authority for the top 100 taxpayers on project G.R.E.A.T (Ghana Revenue Enhancement and Transformation) on 14th September 2018 at Alisa Hotel. The forum was to engage tax payers on new initiatives to be rolled out by the GRA in coming days.
Mr Ken Ofori-Atta said payment of taxes is what builds an economy, and in order to achieve the GRA's transformation agenda, taxpayers have a critical role to play. Government's current strategies to mobilise revenue include enhancing performance strategies through automated systems, plugging of leakages, improvement of tax compliance and administration, the review of taxes and the re-orientation of work ethics in line with traditional values.
He said that there are about 6 million potential tax payers and less than 30 per cent are registered with the GRA of which 1.2 million are employees. He added that revenue target for 2018 during the mid year review has been set at GHC 40.22 billion. As at June 2018, GRA collected GHC 16.84 billion out of a target of GHC 17.95 billion meaning actual collections experienced a shortfall of GHC 1.1 billion or 6.18 per cent. This, he said, means that the GRA has GHC 23.38 billion over the half-year to collect to enable government meet its revenue target. Filing rates for corporate taxes also fell from 65 per cent in 2016 to 40 per cent in 2017.
Mr Ofori-Atta said government is determined to widen the tax net and measures such as the criminal prosecution of non-compliant tax payers have been introduced. According to the Commissioner of Customs, Mr Emmanuel Kofi Nti, the project is aimed at three key transformation pillars namely: simplifying the GRA's processes and introducing innovation to make it comparable to world standards, investing heavily in staff training to build skills as well as building a mindset of constant improvement through sourcing of
ideas for change and improvement.
Mr Nti said "GRA can do better than it is doing now and should be rubbing shoulders with the best in Africa. There is therefore the urgent need to significantly increase revenue mobilization to meet growing expenditure". He said this can only be done through full co-operation of the public, especially, tax payers, due to the significant role they play in domestic revenue mobilization efforts.
He urged tax payers who engage in tax avoidance schemes particularly through transfer mispricing to streamline their affairs by making substantial tax payments to help expand the tax base. In order to achieve a significant uplift in revenue mobilisation, new initiatives such as naming and shaming, full application and imposition of sanctions including prosecutions and distress sanctions have been laid out which, according to Mr Nti, will have critical implications for stakeholders including tax payers.
The Commissioner for Customs, Mr. Isaac Crentsil addressed tax payers on the issue of goods not clearing in 48 hours as stated by the GRA. He said this was due to the fact that some agents wait for ships to dock before filing their documents which led to a delay. He encouraged them, therefore, to start the documentation before the ships dock to enjoy the 48 hours as the GRA operates on the pre-arrival system.
The GRA also addressed tax payers concerns on the Cargo Tracking Note (CTN), the Tax Amnesty window and the multiplicity of audits for companies. They also encouraged companies with commercial vehicles to register them as such, in order to enjoy exemptions. In an interview with Mr Jerry Ossom from Eaton Towers, he expressed satisfaction at the forum saying that "for the first time, Ministry of Finance and Ghana Revenue Authority has called for a dialogue on their initiatives". He said during the forum he raised concerns on multiple audits conducted by the GRA and the tax amnesty window and had satisfactory responses from the organisers.
Others present at the forum were Mr. Kwasi Gyimah-Asante, Commissioner, Domestic Tax Revenue Division; Fred Charles Anson,– Commissioner, Support Services Division, other commissioners and staff of the GRA, stakeholders, Chief Executive Officers and Chief Financial Officers of various institutions and the media.