Assistant Commissioner at the Ghana Revenue Authority (GRA), Emilia Assam, has revealed that the new 12.5% upfront payment introduced by the Authority is to primarily ensure the registration of importers not registered to be taxed.

According to her, the GRA is supposed to ensure that all persons who are registerable are registered and pay the right tax. As such, the upfront payment is in place to ensure that all importers who import in commercial quantities register.

Madam Assam explained that the payment is birth out of the promulgation of the Act 10 (92) of the VAT acts which sets out to ensure that if importers are registered and pay tax as expected.

“Our target is not necessarily those who are registered. In as much as that will give us information to follow up on those who will bring in goods and do not pay the right tax, the focus of this particular upfront payment is to ensure that those who are not registered are registered, file their returns and make payments.”
Emilia Assam

Elaborating on the payment introduced by GRA, Madam Assam noted that if an importer is not registered and imports goods in commercial quantities, then at the port of entry, he will be expected to pay an additional 12.5% of the customs value of the goods he has imported.

The amount paid, she however indicated, is recoverable when the importer registers and files his return that relates to the goods in question.

“… Sometimes with goods that you’ve cleared earlier on, when you do that, then you have the right to recover the 12.5% through the customs single window.”
Emilia Assam

Commenting on the category of imports eligible for the upfront payment, Madam Assam stated that the Authority considers goods that have been imported and are subject to auction. Additionally, she indicated that goods lodged in bonded warehouses also qualify for the payment.

Category of import exempt from upfront payment

Nonetheless, she disclosed that unless the category of goods is exempted by law, especially with the VAT and customs laws which have exempt schedule, coupled with the GRA’s exemption Act that defines goods that are supposed to be exempted, the importer will have to make the upfront payment.

“If it is not listed in these exempt schedules, then naturally it is taxable and if you bring them in, then you’re expected to pay the upfront tax if you are not registered. However, since these things are listed, there are exemptions and in some cases reliefs. For instance, if you import goods that are not valued more than GHC200, 000, then you’ll not be expected to make the upfront payment.
“Again, government institutions and agencies, they are also not expected. We also have categories of goods or transactions that we classify as exempt. For example, the VAT law import machinery for mining or agric, those ones are exempt…”
Emilia Assam

On his part, Alex Oppong Poku, chief revenue officer at the Ghana Revenue Authority, emphasized that the 12.5% upfront payment by the GRA is not a tax but a new payment that serves as compliance tool to compel those who import taxable goods to actually register, charge the VAT and account to GRA.

Furthermore, Mr Poku stated that those who will be required to make upfront payment are importers who import taxable goods which are worth GHC200, 000 or more, and are not registered for VAT.

“So, that is what the payment is meant to do. We want to stress that it’s not a new tax, but it’s a new compliance measure to make sure that those who are to register, do register and pay the VAT.”
Alex Oppong Poku