GRA looks to ICH to boost revenue
As economists and stakeholders in the financial sector continue to ponder the imminent negative effects of the shortfall in revenue from crude oil, there might be some light at the end of the tunnel.
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The introduction of the Interconnect Clearing House (ICH) will generate revenue significantly to the government from telecommunication services.
The ICH is set to commence operations from May 2015. As stipulated by the regulatory body, the National Communications Authority (NCA), the ICH will install state-of-the-art technology to enable a seamless transition to inter-carrier switching, billing and settlement infrastructure, as well as revenue assurance, anti fraud (Simboxing), and network traffic monitoring platforms.
The revenue boost to the GRA will manifest in the following ways:
Elimination of revenue diversion through Simboxing: The solution to be implemented will ensure active detection and elimination of Simboxing.
Unlike the current situation where detection is evident after the occurrence, the ICH seeks to prevent the occurrence; consequently reducing the governments exposure to the diversion of international traffic and the related significant revenue loss to the State.
Accurate monitoring of all on-net/off-net traffic: The infrastructure to be deployed by ICH will ensure that there is an accurate record of all off-net (interconnect traffic). This will enable the actual volume of traffic passed between the operators to be properly reported to the government by an independent body, unlike the current situation where the government depends on the telecom operators to declare the volume of traffic and the revenue accruing to the government by themselves.
The interconnect switch will generate independent call records for all interconnect traffic that passes through it. The ICH will interface with the telecom operators to properly monitor their on-net traffic in real time.
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On a daily basis, the total traffic passed and the revenue due to all parties will be uploaded into the online portal where all stakeholders, including the GRA will be able to review and update their records.
Prevention of capital flight: All operators in Ghana currently depend on international clearing houses for the settlement of all roaming and international traffic. Unknown to many, all the operators are already in existing agreements with international clearing houses who are paid significant amounts in foreign exchange payments, leading to capital flight.
International clearing houses such as Syniverse, Starhome Mach, TNS, and Comfone currently occupy this crucial space for the Ghanaian telecom operators. By introducing a Ghanaian Clearing House, this service will now be performed locally in Ghana.
This will prevent capital flight; create local employment, and lead to development of local information and communications technology (ICT) expertise.
A more robust telecom industry: The interconnect infrastructure to be implemented by ICH will lead to a more robust and reliable interconnect regime in Ghana. This will result in a higher quality of service and call completion rate to the subscribers. This will also lead to higher revenue regeneration by the operators at a lower operating cost, and ultimately result in higher income to the GRA in the form of taxes and levies.
With the operation of the ICH from May, 2015, the NCA has invited and started receiving applications from local companies (not less than 70 per cent Ghanaian ownership) for wholesale international gateway licence.
Most of the current telecom operators have foreigners as their majority shareholders. This, therefore, is a great opportunity for Ghanaians to also benefit from the boom in the telecom industry and also create job opportunities for our unemployed youth.
Hence, GRA can get some corporate tax revenue from these local companies that will be benefiting from this opportunity.