GRA e-VAT system must succeed – Ammishaddai Owusu-Amoah

Recent decision by the Ghana Revenue Authority (GRA) to implement the Electronic Value Added Tax (E-VAT) E-VAT payment has brought some benefits to the country.

The Electronic Value Added Tax (E-VAT) certified invoicing system has been designed to provide the Ghana Revenue Authority (GRA) with visibility into taxpayer transactions never before realised in the history of the GRA and will be a major breakthrough when fully rolled out.

It is destined to revolutionarise the monitoring of VAT transactions and will improve tax collections critically needed at this time for the government.

Currently, taxpayers issue VAT invoices either with i) VAT Invoice Books or ii) using their computer software (they apply every year and GRA certifies).

The problem is that taxpayers can easily under-declare sales with illicit behaviors such as carding of invoices, invoice cloning, suppression of sales and inaccurate reporting of VAT Withholding by agents and the deliberate loss of VAT Invoice Books.

Daily Graphic initial checks with some GRA personnel reveal that the E-VAT solution is designed to prevent tax fraud by providing GRA with visibility into taxpayer transactions.

The system will ensure that GRA will not record a single line item of sales revenue per taxpayer but will have detailed invoices with further visibility on items and quantities per item on each invoice so GRA can now determine which items are taxable or tax-exempt.

We are informed that GRA and later the public will have an easy means of verifying whether an invoice issued by a taxpayer to a consumer is a genuine E-VAT certified invoice or not. Certified EVAT invoices are those that are recognis`ed by the GRA E-VAT system as issued by a taxpayer on a certified system.
Our interactions with some compliant taxpayers suggest that they are pleased with the introduction of this E-VAT system, because it is a good system to record all VAT due to the state however, they want it rolled out to all of their competitors.

Concerns

Some are worried that if the E-VAT system is not rolled out to all of their competitors then their products will be expensive and consumers will patronise their competitors and they will lose income.

Indications are that some taxpayers in the pilot project believe they have cooperated with GRA and feel unfairly treated and stigmatised with the recent public arrests of their managers because they have fully adopted the E-VAT solution.

They are convinced they have not caused any revenue loss to the state although for technical reasons they might not have complied in a few instances with some guidelines of invoice printing.

Further feelings of unfair treatment stems from their perceived selectivity in GRAs rollout and penalty for non-compliance.

Some of these compliant taxpayers belief that the rollout should be for all taxpayers in their sector or sub-sector.

They also believe that when they have complied and not caused revenue loss then they should not be penalised in the same way as those taxpayers who have blatantly not complied at all and are still selling without the E-VAT certified system and possibly benefitting from the VAT windfall.

All in all, GRA needs to be given the necessary room to rollout this solution to all taxpayers regardless of complaints and initial hiccups.