GRA arrests China Mall officials over alleged E-VAT violations

The Ghana Revenue Authority (GRA) has arrested officials of three China Mall outlets following investigations that uncovered suspected irregularities in the recording of sales through its approved Electronic VAT (E-VAT) invoicing system.

The affected branches are located at Ashaiman, Weija and Nsawam, where GRA officers conducted undercover purchases to establish whether transactions were properly captured on the Authority's electronic platform.

Speaking to journalists after the operation, Head of the GRA's Revenue Protection Unit, Wisdom Kofi Xetor, said the exercise involved officers posing as ordinary customers, purchasing goods and subsequently checking whether the sales had been recorded in the approved system.

He said the checks revealed that some transactions were missing from the platform, raising suspicions that the outlets were diverting sales to avoid the required tax reporting procedures.

"We have several China Mall outlets across the country. We visited the one in Ashaiman and conducted a mystery shopping exercise.

"We made purchases and went through the transactions," he said.

"After that, we verified whether the transactions had been captured on our system, and we discovered that some of them had not been reflected," he added.

Mr Xetor further alleged that some sales had been diverted and that the invoices issued to customers did not comply with the Authority's approved invoicing requirements.

"This means those transactions had been diverted. Even the invoices issued did not conform to our approved invoicing system.

"Ashaiman, Weija and Nsawam are the three areas we visited today," he said.

The GRA suspects that the affected outlets may have relied on unauthorised invoicing platforms to keep some sales outside the official E-VAT system.

Although the Authority confirmed the arrests, it has not disclosed the identities of those detained or the number of people picked up during the operation.

Mr Xetor said investigations were ongoing to determine the extent of the suspected tax violations, adding that the Authority intended to pursue prosecution where deliberate breaches were established.

He indicated that offenders could face prison sentences of up to 5 years under the applicable sanctions. However, no charges have been announced, and the stated penalty represents the maximum term cited by the GRA rather than a sentence imposed by a court.

China Mall has not publicly responded to the latest operation.

The enforcement exercise is not the first time the retail chain has come under scrutiny over its compliance with electronic invoicing requirements. In 2022, the GRA shut down some China Mall branches over alleged non-compliance with the E-VAT system.