Ghana Tax Enforcement
The Ghana Revenue Authority is mandated to identify all taxpayers, assess the tax and levies to be paid, and collect taxes such as corporate income tax, the Value Added Tax, other passive taxes and charges, and the recent e-levy. As the Ghanaian Government faces severe budget pressure in 2022 and 2023, the GRA has intensified its tax enforcement efforts.
When tax assessments are issued by the GRA, multinational and local companies sometimes disagree with the assessments of their tax obligations. In such cases, sections 42(5) Revenue Administration Act of 2016(Act 915) as amended by Revenue Administration Amendment Act of 2020 (Act 1029) provides that where there is such disagreement, the company can raise an objection to the assessment. However the company must pay the full disputed amount and any outstanding taxes in the case of import duties and taxes or 30% of the disputed amount plus all outstanding taxes in the case of other taxes. Taxpayers may file an objection within 30 days of receiving a tax assessment or decision. The GRA should evaluate the objection and may agree with the taxpayer or uphold the original assessment or decision.
If the GRA upholds the original assessment or decision, the taxpayer may face penalties and interest charges on the outstanding amount. If the GRA agrees with the taxpayer, the 30% payment should be refunded or credited to the taxpayer’s account.
Section 44 provides that companies dissatisfied with the outcome of this process have an opportunity to appeal to the newly created Independent Tax Appeals Board for redress and further still to the courts. In practice, however, companies have complained that long GRA delays in responding to their appeal have effectively resulted in the 30% payment being held indefinitely by the tax authorities.
Despite dissatisfaction about this provision of section 42(5)(b) of Act 915 which requires the said 30% payment, the country’s Supreme Court last year held that the said provision is not a violation of the constitution, therefore giving the GRA the power to continue the said regime.
See the GRA website for more detailed information on Tax Offences and Penalties.
Companies should seek professional tax advice if they are seeking to dispute a tax assessment.
For more information contact the Commercial Section of U.S. Embassy Ghana at email: Office.Accra@trade.gov or Tel: +233(0)30-274-1870. See our Country Commercial Guide to Ghana and market intelligence on Ghana.