[Ghana] GRA Seeks Out And Punishes Tax Defaulters

In order to reclaim tax liabilities, the Ghana Revenue Authority (GRA) last month closed down a warehouse operated by Pasico Ghana Limited, South Africa Today reports.

The company is a subsidiary of UK-based Paterson Simons and Pollution to Water (P2W) Company Limited, both are located in Accra.

The two companies which respectively deal in world-class cranes, forklifts and building supplies and providing water treatment solutions had PAYE and VAT defaults totalling GH¢19.8million.

Pasico Ghana owed almost GH¢4.9million for a period from 2015 until the present day while P2W has accrued a debt of GH¢14.9 million during the past seven years.

The closedowns were reportedly carried out by the Debt Management, Compliance and Enforcement Unit of the GRA. The team also attended the GIHOC Distilleries Company Limited and the Tema office of the Cocoa Marketing Company.

It has come to light that GIHOC had tax defaults of approximately GH¢182million from the last two years, whereas the Cocoa Marketing Company owed GH¢6.8million from 2018 to now.

Employees of Pasico Ghana and P2W complied with the eviction order by the Debt Compliance Team when they attended the companies’ offices. But a brawl almost broke out at GIHOC when management opposed attempts to halt operations for the tax payment default.

An earlier confrontation by officers of the distillery was avoided because a media team accompanied the tax compliance team, calming tensions. An indoor meeting was held, it resulted in a payment of GH¢1.1million made by cheque.

A meeting was scheduled for 25 October to agree on an effective payment plan so GIHOC could offset the rest of its debt with that of the Cocoa Marketing Company.

Mr Michael Sefa - head of the Debt Management, Compliance and Enforcement Unit - suggested that the GRA will not renege on reclaiming the liabilities it is owed, when he addressed journalists, saying:

"We are following up on these companies because several letters, meetings and engagements with most of them to pay their debts have proved futile and we want to send a signal that between now till December, we will collect every penny of debt owed us."

According to Mr Sefa, most of the debts owed to GRA were from public sector agencies. Some had made plans to pay but he said others were apathetic, prompting the authority to use all available means to claim payment.

Mr Nathaniel Tetteh - Principal Revenue Officer of the Unit - spoke out against the retention of PAYE and VAT by companies, which is a clear violation of the country's domestic tax laws, arguing:

"This tax type is not for the companies. They are monies that have been paid by employees and deducted from salaries while the VAT is money you and I have paid into the company, so this is government revenue which they are keeping and have over kept it."

Mr Tetteh says that as per law, sealed off companies had a minimum 7 days to make part or full payment of the debts owed to in order to resume operations. For failure to do so, "the Commissioner-General may take the decision to auction their assets, we take our money out and give the rest to them or otherwise."

For this reason, Mr Tetteh encouraged companies and individuals to honour their tax payments so business operations could run smoothly and aid the country's development.

Source: South Africa Today