BUDGET: Govt announces measures to increase revenue
Accra, Nov. 10, GNA - Government on Thursday announced various measures to ensure increased revenue mobilisation and prevent leakage from the system.
To minimize the revenue leakages in the tax administration system government will set up a Revenue Protection Unit at the Revenue Agencies Governing Board (RAGB).
Finance Minister, Mr Kwadwo Baah-Wiredu told Parliament on Thursday that government would also submit a comprehensive programme to rationalise the excise tax regime to stem the apparent loss of revenue to the state, due to the poor administration of these taxes. Noting the inherent delays in the refund of VAT and its impact on the private sector, the Minister said the VAT Service would adopt a fast track system for VAT refunds.
Under this system, the first two claims within a quarter are to be refunded automatically without audit. The third claim, however, triggers an audit of the entire period. This new system is to be monitored for further improvement as VAT refund audits indicate lower risk levels.
"To prevent abuses of the bonded warehousing system, the Government would review the operations of the entire system."
Mr. Baah-Wiredu said as a first step, all such warehouses were to be linked to the GCNET system by 31st March 2006 to ensure the tracking of the movement of goods and payment of associated tax obligations. The Minister said government would grant a general one-off amnesty on penalties and sanctions for self-disclosure of un-reported and/or under-reported corporate and personal income taxes, VAT, duties, withholding and other taxes.
The window of opportunity is from 1st January, 2006 to 30th June 2006. Thereafter, the revenue agencies are to rigorously enforce penalties and sanctions for undeclared taxes. In appreciation of the difficulties faced by the informal sector operators in complying with the record keeping requirements of the standard VAT, a Flat Rate VAT scheme, easier to operate and more simplified in its record keeping requirements is to be introduced for the distributive trade sector.
The scheme is being developed in partnership with Ghana Union Traders Association (GUTA) for implementation during the coming year.