E-VAT System To Check Tax Compliance, Improve Business Processes | Economy

The Ghana Revenue Authority on October 1, 2022 deployed the licensed digital invoicing system – generally often called E-VAT – in accordance with the amended Valued Added Tax Act 870. The E-VAT certifies each bill issued by taxpayers in near-real time for income assurance functions.

Speaking to the general public on the Eye on Port programme, members of the E-VAT Technical Team of the Ghana Revenue Authority emphasised that the E-VAT is just not a brand new tax.

Mrs. Felicia Omotayo Owusu mentioned the speed of tax stays the identical for each the usual and flat fee schemes.

“The rate of tax for VAT in the standard rate is 4.5%, NHIL is 2.5%, GETFUND Levy is also 2.5% and COVID-19 Levy is 1%. For flat rate schemes, VAT is 3% and COVID-19 is 1%. Nothing has changed. It is just the process of issuing an invoice. We are using electronic means so we can authenticate and validate the invoices in real or near-real time.”

Mr. Patrick Frimpong Danso on his half mentioned the E-VAT system has seen success in nations the place it's being deployed – reminiscent of Kenya, Tanzania, Rwanda and Uganda.

He added that: “We have a lot of issues with the old system. The GRA had given certain big shops authorization to print their own invoices. There was a possibility they could be suppressing sales. If they made 100,000 transactions in a month, they could declare only 200. We had no way to verify. There is a software they can use to suppress sales figures”.

The GRA in its graduation section of this system has begun with some 50 taxpayers, and by 2024 the Authority will onboard all registered taxpayers onto the E-VAT system.

According to GRA officers, Mr. Danso's outfit has engaged the varied firms being on-boarded onto the system, taught them easy methods to function the system and offered them with Relationship Managers to function a liaison between GRA and the mentioned firm in case of difficulties .

“The Melcom outlets are about 74 across the country, and they have all been on-boarded. Same for the China malls and Palace Mall. We started with them so we can learn from the challenges we faced, rectify them and then onboard the rest who have less complex processes,” Mrs. Owusu mentioned.

The GRA officers nonetheless cautioned individuals and enterprise entities which can wish to circumvent the system to evade tax.

Mr. Frimpong Danso mentioned the GRA is ready to monitor all of the actions of such tax payers pertaining to the issuance of VAT invoices and can ship out a staff each time anomalies are detected.

The officers defined that the invigilation train launched into by GRA over the previous few weeks to examine compliance is critical.

“The officers will cross-check receipts and record the sales so that at end of the week they will tally and compare them with returns on the taxpayer files. Invigilation is part of our compliance tools,” Mrs. Owusu revealed.

The Ghana Revenue Authority says these initiatives being undertaken is not going to solely enhance income assortment on their half but in addition enhance enterprise processes.