Tax clearance certificate digitised — Move to ensure greater compliance, shore-up revenue

IN quest to simplify its compliance systems and shore up revenue, the Ghana Revenue Authority (GRA) has automated the processes used to acquire a tax clearance certificate (TCC).

The electronic TCC (e-TCC) is to help create convenience for taxpayers, stop the faking of tax certificates and generally encourage compliance for increased revenue generation.

The GRA created and deployed an online portal from October 1, that interested taxpayers should use to apply for, and obtain their tax certificates, which are proofs from the authority that firms have fully complied with their tax obligations.

The portal generates the TCC automatically after the required information has been filled out, thereby removing the human involvement which exposed the manual process to various abuses and delays.

Essence

The Head of the Domestic Tax Revenue Division (DTRD) at GRA, Edward Apenteng Gyamerah, told journalists on September 30 that the deployment of the e-TCC would help to remove the delays and frustrations that taxpayers encountered when applying for their certificates through the manual process.

“With the manual process, we also have people faking the TCCs to the extent that some businesses always come back to the GRA to cross check whether a particular TCC issued is authentic.

“So, to be able to resolve these challenges, we are moving into the electronic issuance of a TCC.

“How does it work? All that you need to do as a taxpayer is to apply for a TCC through our portal. On the portal, there is a compliance check to be sure that you have paid all your taxes and

filed all returns.”

“Once you have done all that is required of you as a taxpayer, then you can print it electronically,” Mr Gyamerah said.

To be able to bid for public and some private sector contracts, institutions are required to present their latest TCC.

The Head of the DTRD of the authority said once a firm’s tax identification number (TIN) was given, the authority could automatically generate and send the needed firm’s TCC to the requesting entity online.

“So, the issue of authentication, where institutions come back to GRA as to check the genuineness of certificates issued, would be solved,” he said.

e-VAT

Mr Gyamerah added that the e-TCC was being rolled out alongside an e-value added tax (VAT) system.

He said the e-VAT allowed ‘VATable’ institutions to issue the invoices electronically as against the current system where invoices were issued manually.

He said the automation was meant to remove abuses, including the faking of invoices, under invoicing and under-carding, which lead to loss of revenue.

While the e-TCC would cover all institutions, the Head of the DTRD said the e-VAT would be implemented in phases.

He said the first phase would see about 600 large taxpayers and listed companies being covered between now and the third quarter of next year.

He also said that the second and third phases would cover medium-sized taxpayers in 2023 and all other taxpayers by December 2024 respectively.

Tax digitalisation

Mr Gyamerah said the e-VAT and the e-TCC systems formed part of a tax digitalisation programme being embarked upon by the authority.

The Head of the DTRD of GRA said the programme aimed at improving compliance by prioritising digitalisation to improve convenience, efficiency and speed in tax payments.

He said under the tax digitalisation initiative, cashless payments of taxes and online filing of tax returns have been rolled out, while the e-VAT invoicing and the e-TCC systems were now being introduced.

VAT revenue

Mr Gyamerah was optimistic that the successful roll out of the e-VAT invoicing and the e-TCC would help to strengthen transparency, improve convenience in tax payments and ultimately increase revenue generated.

According to Mr Gyamerah, while the e-TCC was deployed to all businesses from October 1, the e-VAT invoicing would be implemented in phases.

“Through this e-invoicing and other compliance mechanisms such as the mystery purchases and inspection, we hope to move VAT contribution to tax revenues at par or above what our peers are doing.

“The African average is around 30 per cent, but ours is just about 18 per cent maximum. And that is not good for us as a country,” he said.