Tax Court tool for safeguarding state revenue

The news that Ghana’s Chief Justice (CJ), Justice Kwasi Anin Yeboah, has established a Tax Court as a Division of the High Court must be embraced with all goodwill for the CJ.

He may be replicating what is happening elsewhere like the United States, yet he deserves applause for this move because of the growing cases of tax invasion in the country and importance of tax revenue in national reconstruction.

The Court is currently located within the Supreme Court building and uses the Court of Appeal (Criminal Division) to conduct proceedings on Fridays and presided over by Justice Margaret Welbourne, a Court of Appeal Judge sitting with additional responsibility as a High Court Judge.

 
It commenced hearing on October 29, 2021, and the Ghana Revenue Authority (GRA) says tax-related offences are prosecuted thereby its legal officers.


So far representatives of 10 companies, including mining, oil and energy companies, have appeared before the court, accused of failure to pay tax on due dates and making false or misleading statements to the GRA but granted bail to reappear it.

Without any prejudice towards proceedings, the Ghanaian Times would like to state that this is a good move and all stakeholders must support, thus, allow the effective application of the law.

This paper recognises the efforts of the Akufo-Addo administration in taking advantage of the slightest opportunity to accumulate funds for national development, so any attempt to undermine that effort must be fought with every arsenal available.

So far the country’s tax revenue to GDP is, at least, 13 percent, a figure first recorded in 2019, and the government is trying to achieve a target of 20 percent by 2023.

It must be noted that the percentage was around eight in 2000 and remained so for over a decade and a half.

The 20-percent target is good because even almighty USA achieved 24.4 percent in 2018 and 24.5 percent in 2019 while the UK made 32.9 percent in 2018 and 33 percent in 2019 compared with the average of 33.8 percent among the organisation for Economic Co-operation and Development (OECD) countries, whose offices are located in Paris, France.

They are 38 countries from North and South America, Europe and Asia-Pacific committed to democracy and the market economy and ready to assist other countries’ economic development among other objectives.

We bring in the OECD countries because even though these are donor countries, their average tax revenue to GDP is so far not close to 50 percent, which means tax collection everywhere demands strenuous efforts.

Ghana’s good neighbour but bitterest competitor in everything in West Africa, Nigeria, has tax revenue to GDP at 6 percent.

 In the face of the OECD and the Nigeria scenarios, one good the other bad, this paper can reiterate the point that Ghana is doing relatively well and so any attempt of non-payment of tax in any form or shape must not be tolerated.

The country even needs to widen the tax net to ‘catch’ more taxpayers for it is losing revenue by letting some income earners off the hook.

For instance, researchers have found that the country loses around 227 million cedis (over $45 million) in potential tax revenue from the informal sector each year.

Therefore, once again, the Ghanaian Times commends the efforts of the Chief Justice and his team, including the GRA, because their effort would increase state revenue for more national development.

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