[ 2015-12-11 ]

Revenue Administration Bill submitted to Cabinet
The Deputy Minister of Finance, Mrs. Mona Quartey,
has said the proposed Revenue Administration Bill
is in its final draft and will be submitted to
Cabinet for onward transmission to Parliament for
passage.

“All the common administrative provisions in the
previous tax laws have been pooled together into a
single legislation. I wish to inform you that the
proposed Revenue Administration Bill is in the
final draft and will be submitted to Cabinet very
soon for onward transmission to Parliament.”

The B&FT has gathered that the Revenue
Administrative Bill is expected to be laid in
Parliament during 2016. Its passage will focus on
measures that will ensure tax compliance and
improve revenue administration rather than
introduce new taxes.

These measures will include the following: moving
all processes to an electronic platform and
accelerating the shift to a functional form of
administration in all tax offices; review the
current thresholds for classification of persons
as large, medium or small to reflect current
trends; establish joint audit/investigation teams
to conduct audits and investigations; intensify
the monitoring of Free Zones Enterprises by
rolling-out the Integrated Free Zones Unit in line
with the 2nd GRA Strategic Plan 2015 -2017. The
measures will also implement the Electronic Point
of Sale project and roll-out fully the excise tax
stamp project.

Mrs. Quartey said this at the official launching
of the new Income Tax Act 2015, Act (896) which
seeks to revise and consolidate the law relating
to income tax and simplify provisions of the Act.

The Act also makes it more user-friendly, retains
provisions that are peculiar to income tax
administration, and also enhances efficiency and
facilitates compliance while broadening the tax
base -- removing the narrow and distorted tax base
of the Internal Revenue Act 2000 (Act 592); thus
rationalising, streamlining and restricting tax
concessions in the country.

“A great challenge facing our nation today is
the ever-increasing demand for development and the
needed revenue to meet such demands. Government
finds such demands legitimate and part of the
social contract between citizens and government.
Such demands also serve as a constant reminder for
government to find avenues of raising revenue,”
she said.

She stated that the national governments must
have the revenue necessary to fund operations of
their various departments, provide infrastructure
and services for the population, invest in
economic development, and advance various other
priorities.

“To be able to raise the required revenue,
government must be able to enhance the main
mission of tax administration, which is to collect
the tax revenue due from taxpayers under the
country’s tax laws without hindering private
sector development,” she indicated.

The main responsibilities of the tax
administration, she explained, is to administer
tax laws fairly and impartially and also minimise
the cost and burden on taxpayers in complying with
their tax obligations.

“ It is in this light that l see the launch as
another means of letting our countrymen/women know
the law that regulates the payment of tax from
their hard-earned income, and of need to honour
their tax obligations,” Mrs. Quartey said,
adding that the role of taxes in the lives of any
nation’s people cannot be over-emphasised. It is
largely in this regard that nations and
governments attach great importance to taxation,
and have tax laws as key parts of their domestic
legislation.

Taxation, she explained, is a major fiscal tool
in mobilising revenue and directing investment
flow -- and has never been popular. One political
maxim is that no one likes paying taxes.

“However unpopular, we must also remember that
taxation is the price we pay to live in civilised
societies. While the tax administrator aims at
maximising revenue, the tax payer finds ways and
means of paying the minimum tax possible,” she
said.


The Commissioner General of the Ghana Revenue
Authority, Mr. George Blankson, said the
integration of Revenue Agencies in 2010 created a
need for the harmonisation of administrative and
new tax laws expressing the need to incorporate
charging provisions and administrative processes
peculiar to the divisions.

Prior to passage of the Ghana Revenue Authority
Act, 2009 (Act 791), the three revenue agencies
had their respective tax laws made up of the
charging provisions and administrative provisions.
Some of the administrative provisions were common
to the respective tax laws, while other provisions
were inconsistent with similar ones in these tax
laws.

Income Tax administration in Ghana has seen
several challenges over the years. The business
environment within which the tax administrator
operates has been in a continuous state of flux.
Technological, social, economic and cultural
factors have had great impacts on the tax
administrator over the years. The growing
complexities of business organisations and the
advancement in technology call for a tax
administrator who is abreast with changing trends
in society.

For a number of reasons, efficient tax
administration is a major problem in developing
countries. Not only do developing governments face
an uphill battle in bringing individuals and
businesses into the taxation process, but there
are also challenges arising from insufficient
administrative staff, high levels of illiteracy
among taxpayers, lack of sufficient equipment and
facilities, and lack of reliable statistical
data…all negatively affecting revenue
mobilisation.

Apart from these challenges confronting developing
nations: “Ghana’s problems seem to have been
compounded by a direct tax act, the Internal
Revenue Act 2000 Act, which was complex and not
user-friendly. There is therefore need to replace
it with a new Act that takes into consideration
international best practice”.

Mr. Blankson said the Income Tax Act, 2015 (Act
896) is therefore part of the process of
reorganising the tax laws known as the Tax Law
Project, confirming that it reorganises the
residual provisions in Act 592; simplifies it and
makes it user-friendly, while retaining provisions
that are peculiar to income tax administration.

These include provisions which specifically guide
the different methods and time for payment:
including tax payable by withholding, tax payable
by installment and tax payable by assessment to
improve/enhance efficiency and facilitate
compliance. Added to these was the striking narrow
and distorted nature of the tax base in the
Internal Revenue Act, 2000 Act 592.

Ralph Tufour, Chairman of the launch, remarked
that the GRA has since integration of the revenue
agencies strived to improve service delivery,
re-engineer its business processes and procedures,
and simplify the tax laws to make them
user-friendly.

“It is in this light that the Income Tax Act,
2015 (ACT 896) and the other tax acts must be
seen. Since 2010, the GRA has through the Tax Laws
Project, an initiative in the GRA Strategic Plan,
worked closely with government and Parliament to
pass the following Acts.


“It is important to remember as Ghanaians that
the bottom line for provision of the needed
infrastructural and social facilities and the many
other numerous requests citizens legitimately make
on government is revenue,” he said.

He added that people must therefore strike the
needed partnership between our business activities
and the tax administration, and accord taxation
the required priority.

“It is time to stop the practice of putting our
tax affairs on the back burner until we are
compelled by circumstances to deal with them. We
must appreciate that nothing gets done without
revenue,” he remarked.

Source - Bus & Fin Times

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