You Can’t Drive A Luxury Vehicle in Ghana Without Paying Vehicle Tax

Accra, Ghana, July 19, 2018//-Ghana’s Minister of Finance, Ken Ofori-Atta has imposed tax on people riding luxury vehicles in the West African country.

The move has been welcomed with divergence views. Those who are using luxury vehicles have against the imposition of the  luxury vehicle tax on vehicles with capacity of 3.0 litres and above. While those who can’t afford such vehicles have welcomed the move.

However, the minister did not disclose the percentage of the tax to be charged. The tax, Mr Ofori-Atta revealed would be paid on first registration, and subsequently during annual renewal.

He noted that Commercial vehicles are exempted from this policy which takes off immediately after the approval of the Mid-Year Budget 2018 by Parliament.

According to Mr Ofori-Atta, the introduction of the tax is part of measures aimed at mobilising revenue for the government to implement its programmes in the country.

Presenting the Mid-Year Budget 2018 in Parliament today, he stated based on the fiscal performance for the first five months of 2018, we have programed the underlisted measures to ensure that we meet our fiscal deficit target of 4.5 percent of GDP to end the year.

These he mentioned include:  Conversion of National Health Insurance of 2.5 percent to a straight levy of 2.5 percent;  Conversion of GETFund value added tax rate of 2.5 percent to a straight levy of 2.5 percent;  review of Personal Income Tax to include an additional band of GH¢10,000 and above per month at a rate of 35 percent; and  Intensify tax compliance measures.

” Mr. Speaker, as part of efforts to improve revenue performance, we will intensify tax compliance and plug existing revenue leakages.

Investigations we have undertaken show inbound leakages on goods arriving in the country, significant outstanding tax debts, abuse of suspense regime in the area of warehousing, transit trade, and free zones, and tax audit issues such as limited coverage, low auditor productivity, and low audit yields”.

Mr Ofori-Atta was quick to add that the government is rolling out major initiatives to address these tax compliance issues.

“Mr. Speaker, these initiatives will include prosecutions of tax evaders and corrupt tax officials, a special VAT Attack force to ensure enforcement and deepen VAT penetration from the current low levels of 11 percent, and institutional reforms at Ghana Revenue Authority (GRA).”

The tax compliance, he noted would also be boosted by the implementation of the Common Platform for Communications Traffic Monitoring, revenue assurance, mobile money monitoring, and fraud management.

The Common Platform will provide government with an accurate and comprehensive view of telecom revenues in order to verify tax compliance and to ensure the comprehensive billing and collection of all telecom-related taxes, levies, and regulatory fees, Mr Ofori-Atta explained.

African Eye Report 

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