GRA holds forum on income tax law
The Ghana Revenue Authority (GRA) has held a stakeholders forum on the income tax law to clarify some of the issues raised since the beginning of the implementation of the tax.
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The forum, which was part of a series of programmes to address some of the concerns of the public, was also used to explore loopholes in the law which took effect on January 1, 2016.
Participants in the forum included tax consultants, tax professionals, accountants, officials of the Ministries of Finance and Communications, representatives of media organisations and the GRA.
It was organised in collaboration with the Ministries of Finance and Communications.
Mixed views
While some of the participants criticised the law which in their view was a disincentive to business investment, others commended the framers of the law and described it as the appropriate law for the effective collection of revenue due the state.
Some of the participants who pointed out the loopholes cited specific sections of the law on tax holidays, gift tax, and withholding tax among other issues while others called for guidelines to enhance the implementation of the law.
The President of the Charted Institute of Taxation, Ghana, Mr Mike K. Afflu, pointed out that some businesses were relocating to Cote d’Ivoire due to the stringent nature of portions of the law.
He was of the view that the upward review of the withholding taxes on services from five per cent to 15 per cent was too high.
"We think the five per cent withholding tax should be maintained. Widening the tax base does not mean increasing taxes but rather putting in place efficient compliance mechanisms," he said.
Mr Afflu also suggested that traditional and religious leaders were included in tax education campaigns and the inclusion of taxation in the educational curricular at the junior high school level.
On the payment of one per cent tax by companies when they made profit while on tax holidays, Mr Afflu stated that "no advanced tax regime in the world charged businesses taxes while they were on holiday".
A tax consultant, Mr Eric Amponsah Boateng, stated that the payment of taxes by residents on income derived outside Ghana would be difficult to achieve as a result of the lack of data.
The Commissioner General of GRA, Mr George Blankson, said the objective of the law was to simplify the provisions of the Act and to make it more user friendly.
After welcoming the criticisms, Mr Blankson said: “We cannot make the payment of taxes a bed of roses but we can make it easier.”