VAT on e-commerce: GRA partners two regulators to track online spending
The Ghana Revenue Authority (GRA) has partnered with the Bank of Ghana (BoG) and the National Communications Authority (NCA) to help it monitor amounts of monies spent on online services.
The GRA also noted that it has deepened collaboration with telecommunication companies in order to ensure that the use of online services by non-resident businesses will be properly monitored and accounted for to allow proper charging and collection of taxes.
According to the GRA, this collaboration paves the way to determine how much Ghanaians spend on WhatsApp, Instagram, YouTube, Netflix, Amazon, Google, among others, to enable it to collect value-added tax (VAT) from the non-resident businesses.
The monitoring of transactions also applies to betting and gaming companies that are not based in Ghana, although their services are consumed by Ghanaian residents.
Mr Edward Appenteng Gyamerah, who is the Commissioner of the Domestic Tax Division (DTRD) of the GRA, has revealed that although the VAT Act, 2013 [Act 870] has been passed and allows the authority to impose VAT on online services consumed in the country, the GRA had been unable to implement the law.
He added that the authority had now developed the needed tools and guidelines to be able to implement the law and collect the taxes due the state.
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Consequently, he said it had set aside April 1, 2022, to start collecting VAT from non-resident persons and institutions that provided services for use and enjoyment in Ghana.
He also indicated that the GRA had also developed a portal that the companies would use to register, file and pay their taxes to the state in accordance with Act 870.
“Most of the betting and gaming companies are also online and so this law applies to them,” he said.
Furthermore, he stated that the monitoring mechanism was also in place to ensure that, “what they are declaring to us as revenue is the true reflection of their activities in Ghana.”
“With regard to monitoring e-commerce, a lot of institutions come on board. We have the role that the NCA plays and we have the role that the BoG plays,” he said.
“Remember that you cannot make any payment outside Ghana without passing through the BoG platform. The telcos also play their part through the mobile money and data services. All these institutions are onboard to support the compliance effort of the GRA as far as this VAT on e-commerce is concerned,” he added.
The Commissioner of the DTRD added that the authority is targeting GH¢2.7 billion from the VAT on e-commerce and online gaming and betting this year.
Of the amount, he said GH¢1 billion is to come from e-commerce while the remaining GH¢1.7 billion is expected to come from the betting and gaming space.
