The Ghana Revenue Authority (GRA) has waived interest payment and penalties on tax defaulting companies and individuals as part of measures to encourage full compliance.
Subsequently, it has asked the defaulters, those already in the tax system and the ones yet to register with the GRA, to take full advantage of the amnesty granted until the end of September this year to avoid sanctions.
Explaining the difference between the tax amnesty granted in the past and what has been announced recently in an interview with the GRAPHIC BUSINESS in Accra at the weekend, the Head of Communication and Public Affairs at the GRA, Mr Kwasi Bobie-Ansah, said “for those companies and individuals who are already in the tax system of the GRA but have not been able to honour their tax obligations, they will not be made to pay any penalties on the amount owed”.
Again, he said that category of defaulters would also not be made to pay any interest on the money owed to the state; “they will only pay what they owe, which is the principal, and that will be all”.
On the other hand, Mr Bobie-Ansah said those who have not been able to register at all with the GRA between the years 2014, 2015 and 2016, would not be required to either pay penalties, interest or the real tax amount due to the state.
“For that category of defaulters, we have waved everything for them and so they will not pay anything to us”, he said.
According to him, hitherto, such defaulters were made to pay the principal but “this time, we have decided to waive what they owe to encourage them to honour their obligations voluntarily.”
Broadening tax net
On the back of calls for the GRA to find more pragmatic means to broaden the tax net to reduce the burden on those already captured, Mr Bobie-Ansah said the
amnesty granted was meant as one of the ways to widen the net.
“With this amnesty granted, we expect more companies and individuals to honour their obligations according to the law”, he said.
According to him, while the GRA will not relent in enforcing the laws to ensure that companies and all income-earning persons complied fully to honour their obligations, “we will also use persuasion and constant reminders and education to get people to live up to their civic responsibilities to the state”.
The GRA is expecting to raise between GH¢300 million and GH¢500 million for the government from the tax amnesty programme.
This year, the GRA has a tax revenue target of GH¢39.8 billion.
In 2017, the authority failed to meet its target as it raked in GH¢32.3 billion and registered a shortfall of GH¢1.1 billion.
This is not the first time Ghana is granting tax amnesty to tax defaulters, since in October 2012, Parliament passed the Internal Revenue (Tax Amnesty) Bill, 2011 granting a reprieve to tax defaulters and seeking to widen the income tax net to improve Ghana’s revenue inflows.
Unfortunately, the previous tax amnesty programme was not encouraging, because of the nature of its presentation.
People were not encouraged to come forward. But this time the GRA is encouraging people to comply and save themselves from criminal suits.
Tax reprieves, the world over, give a significant number of liable taxpayers a break to start afresh in fulfilling their tax obligations, which result in the widening of the tax net to generate more revenue for the country. — GB