As the new government is set to present its maiden budget statement and economic policy to Parliament, the Ghana Union of Traders Association (GUTA) is appealing for a tax amnesty for defaulting members.
The plea of GUTA is in the realms of the economic reset agenda touted by the new government. President of GUTA, Dr. Joseph Obeng says the reset agenda must offer new opportunities for defaulting taxpayers to also reset and start afresh.
The president tells The High Street Journal in an interview that many businesses have defaulted in their tax obligations not out of deliberate efforts to evade. He explains that the majority of these defaulters have fallen short of their obligations due to the cumbersome, complex and high burden imposed by the system.
He explains that over the years, businesses have unwillingly accumulated tax liabilities due to the pressures of an inefficient system. He adds that now that the government is seeking to streamline taxation and restructure the economy, businesses should also be given the opportunity to correct past missteps without crippling penalties.
GUTA is therefore of the considered view that the government as part of the reset plans and promise to rationalize the tax system must offer a pardon for defaulters to start on a clean slate.
Among the numerous expectations of the business community, GUTA says it would be happy to see the Minister announce an unconditional tax amnesty at tomorrow’s budget reading.
“We expect the budget to introduce unconditional tasks amnesty to enable businesses to start afresh and reset their task obligations. People do not do this very deliberately because we have all recognised that the tax itself is cumbersome, the tax itself is very complex and is also very high. So as they try to do, they are bound to make some mistakes,” Dr. Joseph Obeng told The High Street Journal.
He further explained that, “If you say that we are rationalising the taxes now, and then we are resetting the economy, you then of course you have to also reset our tax obligations. We have to start afresh and reset our tax obligations because in the past things were so cumbersome that influenced those mistakes due to the pressure of the system. So if we are talking about resetting, we should also reset that.”
GUTA believes that a tax amnesty will encourage defaulting businesses to re-enter the tax system without fear of excessive penalties. It will also improve tax compliance in the long run by giving businesses a second chance, boost government revenue, as more businesses will be willing to comply under a fairer, simpler regime, and promote economic growth by reducing financial distress among traders.
The call for a tax amnesty comes alongside GUTA’s demand for a simplified, uniform VAT system to replace the current tiered structure, which they describe as discriminatory and difficult to comply with.
Source: TheHighStreetJournal