The Akufo-Addo/Bawumia government is set to tax the foreign incomes of Ghanaian residents following the abandonment of the value-added tax (VAT) on electricity.
Earlier this year, the government introduced a VAT on electricity, but public outcry led to its abolishment, leaving a revenue gap estimated at GH¢1.8 billion.
Initially, the VAT on electricity was part of Ghana’s revenue measures in the IMF deal but the initiative was abandoned after public resistance, leading to a revenue shortfall.
Ghana’s deal with the IMF entails certain expenditure rationalization and revenue measures to ensure fiscal consolidation of the economy.
Julie Essiam, the boss of the Ghana Revenue Authority (GRA), clarified, “The alternative is a compliance measure on foreign incomes of resident Ghanaians. Not Ghanaians abroad. We want to make that clear. This is not a measure. It has been in the policy but its implementation has not been optimal.”
She further stated, “We are happy to announce that we have put strong and structural measures in place to ensure that this yields the revenue of GH¢1.8 billion and beyond.”
The GRA has also introduced a voluntary disclosure opportunity for taxpayers to declare their foreign income accounts within three months. Taxpayers who comply will have the interest on their accounts waived.
Essiam highlighted, “Its implementation has begun because the team is mobilising themselves and drafting the letters to be sent to individual account holders. So by the 2nd of May, those letters might have gone out.”
“If individuals come forward within three months and say that, this is the amount in this account, the interest on the account will be waived and that is the voluntary disclosure aspect of this measure”.
Acknowledging the necessity of new measures to revive the economy, Finance Minister Dr Mohammed Amin Adam urged Ghanaians to support the government during this process.
#MetroNews Good afternoon pic.twitter.com/yuCrIGbdX0
— Bee (@Bridget_Otoo) April 15, 2024
