'Insist On VAT Receipts'

Augustine Abankwa in a chat with some students

Augustine Abankwa, Head of the Enforcement and Debt Management Unit of the Value Added Tax (VAT) Service, has urged students to insist on their VAT receipts any time they patronized goods and services from VAT registered agents.

He made the call during a seminar that was held at the Accra Academy High School to educate students on VAT and how to mobilize resources for national development.

He explained that students had been targeted this year as watchdogs for the agency because “they form a larger portion of the consumer population in the country.”

“Many cases of tax evasion has been discovered as a result of the collaboration between the general public and tax agencies,” he added.

According to him, paying taxes is a civic responsibility, which applies to all Ghanaians, adding that the mission of the VAT service is to collect taxes.

He encouraged registered agents who collect the taxes to pay them voluntarily in the offices of the service.

Mr. Abankwa defined VAT or National Health Insurance Levy (NHIL) as taxes paid on goods and services by persons who use the goods and services.

He however said businesses that retail can only register with the Service when they make total sales of about GH¢10,000 per year.

“This is to say that businesses that do not retail are required to register with the VAT service whether they make sales of GH¢10,000 or not,” he noted.

In view of this, the VAT service has provided two different rates, which includes 3 percent for retailers and 15 percent for all other businesses as charges for their product or services.

He further explained that out of the 15 percent rate, 10 percent was paid as VAT, while 2.5 percent goes to GETfund and another 2.5 percent for the NHIL.

The 3 percent, he added, is distributed as 0.5 percent for NHIL, 2.5 for VAT and GETfund.

The revenue generated, he added, were channeled into the building of schools, hospitals, police stations and other projects in the country.

“Through the GETfund, public schools have been renovated with new ones built as well as the purchases of buses for schools.

“The NHIL has also greatly subsidized health services for us and made health services more accessible to the ordinary Ghanaian, especially the rural people,” Mr. Abankwa stressed.

Felicia Nuworkpor, the Public Relations Officer of the VAT Service, in an interview with CITY&BUSINESS GUIDE, said the VAT service has established the informant reward scheme for the general public to provide information to the service. She noted that the reward, which is 2.5 percent, would be given out of the money realized to the informant.

By Jessica Amponsah