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Updated: Mar 24, 2023

Over 50 tax experts and lawyers in Ghana on Thursday 9th July 2020 converged online to critically review Ghana’s tax policies, and how to improve tax administration in Ghana.

The program which was organised by the Chartered Institute of Taxation Ghana (CITG), the statutory body set up under the Chartered Institute of Taxation Act 2016, (Act 916) to promote the study of taxation and regulate the practice of taxation in Ghana. It was exciting to hear these seasoned tax consultants talk about tax issues in Ghana and how the general tax system in Ghana can be improved, especially in this current era of the Covid-19 when public finance has fallen below target. It will be recalled that, import duty alone missed the revenue target by over GHS 400m in the first quarter. The impact is significantly high as domestic tax is also not doing well.

The online program was under the theme “Conduct of Business: Tax Obligations Imposed on Entities & Their Managers and Other Stakeholders”.

Among the experts who presented various aspect of the program were Dr. Isaac Nyame, Mr. Dominic Naab, Mr. William Owusu Demitia, Dr. Martin Kolbil Yamborigya, Mr. Theophilus Tawiah, Mr. Martin Dordzie and Mr. George Ankamah.

Dr. Ali Nakyia who chaired the program reiterated the important role that the Chartered Institute of Taxation can play in shaping tax policies in Ghana because the Institute is a composition of seasoned tax consultants and lawyers.

The theme presenter, Dr. Isaac Nyame bemoaned the lack of knowledge in taxation among the citizenry which reflects in most cases, some businesses not being aware of the obligations imposed on them when conducting business in Ghana.

He expressed the view that the Tax Institute can partner with the GRA to improve tax education in Ghana which will eventually improve the tax compliance in Ghana.

Some key aspects of taxation discussed at the online forum included Supply of Goods & Services and Withholding Tax Obligations, Employment and PAYE Obligations, Investments, Windfall & Lottery Earnings, Rent, Capital Gains and Gifts Tax, VAT, GETFUND & NHIL and Registration and Obligation, Employment and Contribution towards Pension & Retirement and Accounting for Taxes withheld.

There was heated discussion when the issue of withholding tax policy in Ghana was tabled. Whiles the experts admit that withholding tax is mostly used as a compliance tool by the GRA, the experts generally believed that, withholding tax in its current form requires critical review. A withholding tax is an amount that a person making the payment withholds and pays directly to the GRA. The provisions of the Income Tax Act, 2016 (Act 896) requires a resident person who pays an amount for works or the supply of goods and services to another resident or non-resident person, with a source in Ghana, to withhold tax from the payment.

Mr. William Demetia and Mr. Theophilus Tawiah, when leading the discussions on rent and gift tax and accounting for withholding tax expressed the view that, the existing law requires some amendments.

Francis when leading the discussion on windfall tax expressed the view that, the government can consider imposing tax on windfall or excess profit on some industries which may have benefited from the Covid-19 pandemic. He cited the instance where 5% National Fiscal Stabilization was imposed on Banks (Excluding Rural & Community Banks), Insurance companies, Telecommunications companies, Breweries, etc as well as Additional Oil Entitlement inf the Petroleum section as some existing windfall taxes. “At the time the Stabilization levy was imposed on these selected companies, these companies were making profit so a form of windfall tax was imposed on them to “stabilize” the economy”. On the same principle the government could levy excess profit tax on industries like textiles, Ethanol and hand sanitizers, Veronica buckets manufactures presumably for making excess profit.

In his closing remarks, the President of the Chartered Institute of Taxation, Mr. Nii Ayi Aryeetey thanked all participants of the program and encourage the members of the institute to continue shaping the tax agenda in Ghana. The Registrar of the Institute, Mr. Frank Yao Gbadago encouraged the public to participate in the upcoming programs by visiting the Institutes website for more details.

Prohibition from practicing taxation in Ghana

Meanwhile the Institute has issued a strong warning to the general public from practicing taxation in Ghana without the appropriate license. It is an offence to practice as a tax practitioner if one is not a member of the CITG. Section 19 of the CITG Act, 2016 (Act 916) provides as follows:

19. (1) A person shall not practice as a chartered tax practitioner or tax practitioner or profess to practice as a chartered tax practitioner or tax practitioner, unless that person

a) is a registered member of the Institute and the name of that person is on the register of chartered tax practitioners or tax practitioners published by the Council, and

b) Holds an unexpired certificate to practice.

(2) For purposes of this section, "practice" means a person

(a) engaging in the practice of taxation or professing to practice as a chartered tax practitioner, tax practitioner or tax adviser,

(b) offering to perform or performing a tax service,

(c) rendering professional services or assisting in respect of matters that in principle or detail relate to taxation, or

(d) rendering any other services prescribed by the Council by Regulations to be service constituting practice as a chartered tax practitioner or tax practitioner

in consideration of remuneration received or receivable by a person or in partnership with another person.

The penalty ranges from GHS 60,000 to one year imprisonment. Also under the Tax Laws of Ghana, it is an offense to practice as a tax consultant when one is not an approved consultant.The Revenue Administration Act, 2016(Act 915) prohibits persons to act as tax consultants unless the person is an approved tax consultant. Section 18 of Act 915 provides that only a person who is an approved tax consultant may represent a taxpayer; provide advice primarily regarding the interpretation or effect of a tax law; or Prepare a tax return, appeal or other document under a tax law. A person who is not an approved tax consultant shall not represent that, that person is a tax consultant; or charge fees to offer assistance with respect to the matters of taxation in Ghana. The institutes has indicated its intention to enforce the law and prosecute the general public who breaches the law.

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