Traders want 3% flat VAT rate, CET, others scrapped by incoming govt
Ghana Union of Traders Association (GUTA) has underscored the need for the new government to quickly move to tackle the association’s concerns in order to safeguard local businesses.
Some of the issues GUTA wants the NPP government to act on include tax stamp, 3 percent flat VAT rate and the ECOWAS Common External Tariff as well as the influx of foreigners on the country’s retail market.
According to GUTA, though prior to the elections they met with the NPP and discussed their concerns which saw most captured in the party’s manifesto, it was imperative that the Nana Akuffo Addo led – administration acted quickly to save the ailing trading market.
Speaking to the thebftonline.com an Executive Member of GUTA, Benjamin Yeboah said the government with the majority in parliament must pass policies that will engineer economic growth and create employment.
“Though they came and solicited from us the challenges we face we think the time has come for them to now keep their side of the bargain by fulfilling their promise. We appreciate that fact that most of the issues we raised with the party when they visited us found its way into their manifesto. This means they are committed to correcting some of the challenges we face.”
“So with them now coming into power, we are very hopeful that all those things that we sort to have corrected, which we felt was not helping the business community and which we started making a lot of noise last year, February, they will take it up and then work on it,” he said.
Mr Yeboah also added that one of the things they also wanted to be addressed was the tax stamp, which the Ghana Revenue Authority (GRA) had wanted to implement.
The Executive Member explained that it was not going to help the system because they felt it was a duplication of functions and was inimical to doing business in the country.
The 3% flat VAT rate which became 17.5% was reverted by the government due to GUTA’s insistent calls to shed off some tax load on industry players.
He also added that, the GRA had also increased the “threshold on their blind side” from Gh?90,000 per annum to about GHC200,000- which meant that there was no a lot of people who were not going to charge VAT.
“We felt that was wrong in the sense that if you are not lucky, you might have a shop that makes that turnover at the end of the year and therefore qualifies to collect. You might have a similar shop which sells similar items but do not have that turnover, therefore they will not be collecting that disparity to us was the problem. And felt they did not consult the major stakeholder before doing that and we felt it should be reversed and the threshold brought down” he said.
On the Common External Tariffs, he indicated that the upgrading should be done in a gradual process since it did not affect some commodities following their meeting with GRA.
Additionally, GUTA wants the new government to check the influx of foreigners on the country’s retail markets by enforcing laws that protect local businesses.
GUTA cries over high taxes
The Ghana Union of Traders Association (GUTA) has raised concerns about the 3% Flat Vat Rate system which they say is brooding confusion among the association members and the Ghana Revenue Authority.
Under the Vat Flat Rate Scheme, retailers with annual turnovers of between GH¢100 million and GH¢1.2 billion are expected to pay three per cent of their turnovers as Value Added Tax (VAT).
The 3% flat vat rate which became 17.5% was reverted by the government due to GUTA’s insistent calls to shed off some tax load on industry players.
GUTA had also earlier threatened to hit the streets following the adoption and introduction of the Ecowas Common External Tariffs (CET).
According to GUTA, the new law is unfair. GUTA’s threat follows the implementation of the Common External Tariff, which took effect on Monday, February 1, 2016.