The new arrangement will extend the electronic invoice system beyond the 50 large taxpayers who have been on the system since last year following the commencement of the e-VAT system on a pilot basis.

Ahead of the enrolment of the taxpayers, the GRA yesterday engaged the chief executive officers and account officers of the selected businesses to be on-boarded onto the e-VAT system in Accra to take them through the new system and the legal framework for its implementation

All the selected companies are to be on-boarded before the end of June 2023 during the first phase of implementation, while the second phase will end by December 2023.

This will result in an additional 1,000 businesses getting on board the e-VAT, with all other taxpayers scheduled to be enrolled by December 2024.

When fully implemented, all taxpayers will move from a manual to an electronic system, in line with the provisions of the VAT Law.

The e-VAT system has seen success in countries such as Kenya, Tanzania, Rwanda and Uganda.

Cooperation

The Head of the Domestic Tax Revenue Division of the GRA, Edward Gyambrah, described the selected taxpayers for the first phase of the implementation as "our blue chip taxpayers" and urged them to partner the authority in its quest to mobilise enough revenue for the state.

He said the electronic VAT invoicing had become necessary as it had been found that the VAT contribution to total tax collection was low, compared to other jurisdictions, such as Togo, where it was about 40 per cent, 42 per cent in Benin and in excess of 50 per cent in Cote d'Ivoire, “but in Ghana, we are just around 20 per cent".

To address the issue, Mr Gyambrah said, there had been a number of measures and innovations "but it has not appreciated to the level we want".

The certified invoicing system was going to be "the sole means of issuing VAT invoices to customers”, he said, and urged the companies to “cooperate and give us the necessary support for the smooth implementation of the e-VAT".

Benefits

The Project Manager of e-VAT, Philip Acquah, said the electronic system would help authenticate and validate the invoices in real time.

He said companies being added onto the system would be taken through training on how to operate it and tested after which they would have to sign off from their old system.

Mr Acquah said the on-boarded businesses would then be assigned Relationship Managers to serve as a liaison between GRA and the company to address challenges.

He cautioned persons and business entities, which may want to circumvent the system to evade tax, to reconsider their decision as the GRA was able to monitor all the activities of tax payers pertaining to the issuance of VAT invoices.

The e-VAT project manager said the initiatives would not only improve revenue collection but also improve business processes.

Additionally, Mr Acquah said the new system would solve the issue of lack of data for effective tax compliance and would ensure a fair and equitable regime for all taxpayers.

Also, he said, it would streamline the refund process as invoice issued would be in a centralised placed and also streamline the reporting of VAT returns.

The system, he said, would have three solutions as "tax payers with no invoicing system will receive free invoicing systems from the GRA, it will also make provision for system-to-system integration; and developers of point-of-sale (POS) accounting software can get it certified by the GRA for use by taxpayers".

A member of the e-VAT implementation team, Isaac Safo, said there was no transition period for on-boarding as once a company was connected to the system it had to go live.

He said there were sanctions for taxpayers who breached the provisions of the law as they would pay an administrative penalty of 50,000 currency points or three times the amount of tax involved or whichever was higher.

A currency point is GH¢1.

Business which failed to issue the e-VAT invoice would be prosecuted and could be slapped with 100 penalty units or serve a two-year jail term or both. A penalty unit is GH¢12.