|Edward Gyamerah, a Deputy Commissioner, GRA speaking at the meeting|
He has therefore, urged businesses to file accurate self-assessment returns on time to avoid paying penalties.
“The new penalty under self-assessment is a little bit huge and so we expect businesses to ensure that they file accurate self-assessment reports,” he said.
Mr Gyamerah was addressing the business sector at the Graphic Business/Stanbic Bank Breakfast Meeting series held in Accra yesterday on the theme: “The new Tax Law; Its implications for the economy and businesses”.
He urged business owners to take a second look at their reports for the last quarter to effect any necessary changes, saying, “The new penalty regime is that if you underestimate your tax payable, you will be required to pay a penalty of 125 per cent of the Bank of Ghana (BoG) discount rate and this one will be compounded from the first month of your basic year.”
While indicating that the interest would be about 70 per cent, he told the meeting: “We don’t take delight in imposing penalties and that is why I am informing you to make sure you submit accurate returns every month and every quarter.”
He said the new act empowered the Commissioner-General of the GRA to request information without going to court, as pertained in the old law, and the bank was obliged to comply.
He also said while under the old law businesses were required to file their returns on or before the commencement of the basic year, the new law required returns to be filed on or before the payment of the first instalment.
Tax on worldwide income
Mr Gyamerah, under the new act, resident and non-resident Ghanaians would now be taxed on worldwide income.
On how that could be ensured, he said the GRA could be privy to tax information on Ghanaians globally because Ghana belonged to the Global Forum for Exchange of Tax Information.
Carry forward losses
Other features of the new act include a provision that allows businesses to carry forward their losses. Under the priority sector, however, losses cannot be carried forward for more than five years.
The new act also recognises lottery activity as an investment activity, which means that tax must be paid on investment income. However, five per cent is to be paid on any gains that exceed GH¢2,592.
Mr Gyamerah also indicated that the new law roped in ‘galamsey’ operators to pay a tax of three per cent on income, explaining that the tax would be indirectly paid by the people who did business with the ‘galamsey’ operators.
He, however, said the ‘galamsey’ operators could apply to the Commissioner General of the GRA to be exempted from paying the tax.
Widened tax net
A tax consultant, Mr Abdallah Ali-Nakyea, who was one of the three speakers at the meeting, said the new income tax act had widened the tax net.
He, however, expressed worry that the stability clauses in petroleum operations meant that the fiscal changes would not affect them and benefit the nation in any way.