The Ghana Revenue Authority (GRA) has set an ambitious goal: to cut the country’s Value Added Tax (VAT) gap in half by the end of 2028. Currently, Ghana’s VAT gap, representing the difference between expected and actual VAT collections, stands at 60%. The GRA aims to reduce this to around 30% within the next four years.
Dr. Martin Kolbil Yamborigya, Commissioner for the Domestic Tax Revenue Division, announced the new target during the launch of the GRA’s VAT Compliance Campaign. Speaking to journalists after visiting shops at the Accra Mall to assess adherence to VAT requirements, Dr. Yamborigya outlined the Authority’s VAT Strategic Plan.
“According to our VAT strategic plan, we are hoping that between now and the end of 2028 we should be able to close this gap from the current 60% to about 30%,” he said. Achieving this, he explained, will require a significant increase in VAT collections and a commitment to broader compliance from both businesses and individuals. “That means that at least we should be able to collect 30% more in addition to what we are currently collecting,” he added.
The GRA’s long-term objective, Dr. Yamborigya emphasized, is to foster a culture of consistent compliance, rather than relying solely on enforcement. “In the long run we expect every Ghanaian to comply so that the tax will be collected,” he stated.
The Commissioner was quick to assure businesses that the ongoing VAT Compliance Campaign is focused on education, not intimidation. “This campaign is not meant to harass businesses and we don’t also intend to disadvantage any business,” he said.
During compliance visits to the Accra Mall, officials discovered that some businesses were not consistently issuing VAT invoices. Rather than taking immediate punitive action, the GRA engaged with these businesses, encouraging them to improve their invoicing practices. “We realized that they were not religiously issuing VAT invoices and we only encourage them to make sure they do the right thing,” Dr. Yamborigya explained.
“If we were not to show human face, we probably would have called for their arrest immediately,” he added, underscoring the Authority’s preference for education and engagement over punishment, unless non-compliance is shown to be deliberate. “We are going to be more engaging, we are going to be more educative. But where we find out that the non-compliance is deliberate, that’s what we apply.”
Through this approach, Dr. Yamborigya said, the GRA is working to ensure that taxpayers understand their obligations and are given every opportunity to comply. “So we continue to show human face by ensuring that people know and understand their tax obligations and comply,” he concluded.
With education at the forefront and enforcement as a last resort, the GRA hopes to boost compliance and close the VAT gap, strengthening Ghana’s revenue base for the future.
Source: Apexnewsgh.com