Modern Ghana logo

FEATURED: Are Muslims Victims Or Promoters Of Terrorism?...

26.05.2007 Business & Finance

VAT Service chases defaulters for ¢17 billion

By myjoyonline
VAT Service chases defaulters for ¢17 billion

The Western regional office of the Value Added Tax (VAT) Service has embarked on a distress action to retrieve more than ¢17 billion owed it by 16 companies and traders in the region.

As part of the action the premises of Western Veneer Lumber Company (WVLC), a timber company, which owes more than ¢10 billion of the total has been sealed. Among the firms twelve are within Sekondi Takoradi and three others in other parts of the region have also been closed down.

The affected companies, in the timber manufacturing and trading sectors, were closed down by the enforcement team of the head office in Accra and the regional office.

At the WVLC the workers were ordered to suspend whatever they were doing as the offi¬cials of VAT took inventory of the items before the closure.

The distress team said the WVLC came to negotiate in 2003 but failed to pay as promised and also failed to file their returns.

Under the execution warrants of distress, the VAT Service was empowered to take possession of the assets of the debtors.

The amount, according to the Regional Manager of the VAT, Mr Samuel Kofi Otabil, left his office with no other option than to move in to retrieve the money rather than take possession of the properties of the affected companies.

Several reminders had been sent previously to the companies, as well as demand notices leading to the closure of their premises.

"The monies these companies collected did not form part of their working capital, it was the amount they had collected as soon as they rendered service to the customer, and therefore, holding back the revenue collected is a big offence,” he said.

He said under section 34 of the VAT Act 1998 and LI 1646 the Commissioner of VAT, acting through his representatives, VAT Service, was empowered to undertake an exercise to recover debt from clients.

He said the amount accumulated as a result of the under-declaration and evasion of taxes through assessment and payment of returns which the traders had filed but failed to pay.

"It is about time the traders and various companies became aware that they are only acting on behalf of the VAT and the government in the collection of the taxes which is not part of the monies used in running their businesses," he said.

He therefore urged traders and companies to be patriotic and pay their VAT promptly to avert any embarrassment.

He said it was not the wish of the VAT Services to embark on distress action but since the collectors failed to honour their obligation they had no other option.

Culled from Daily Graphic