The Ghana Union of Traders’ Association (GUTA) is appealing to government to reconsider a decision to migrate traders from the VAT Flat Rate Scheme to the new Standard Rate Scheme.
“This is because we (traders) have been operating under the Flat Rate Scheme for about five (5) years, and the major challenges we have are as follows: (i) the non-availability of VAT input. (ii) most of the importers who supply goods to us are not VAT registered and do not issue VAT invoice, which can be used as input. (iii) for about five years that we have been operating under the Flat Rate Scheme, VAT invoices we receive are on the 3% and 4% Flat Rate Scheme and (iv) we have stockpiles of goods spanning over ten (10) years; which means that, we will be surcharged from our own money for the lack of input VAT for all these years and, thereby, collapse our businesses.”
This was contained in a press statement issued on Monday, April 11 by GUTA President Dr Joseph Obeng.
It explained how a major tax policy like the Value Added Tax must be uniformed and not discriminatory.
By the statement, the traders are convinced the new Standard Rate Scheme is designed to make it difficult for operators, thereby forcing many out of business.
“It should rather be simplified to make compliance easier and/or raise compliance level higher.”
The traders are, therefore, cautioning government that they cannot migrate to the new scheme.
“In this case, the VAT Scheme should be either Flat Rate Scheme for all traders to operate, or a uniform Standard Rate Scheme that ensures fairness and equity or be made optional for traders to choose any of the two that may be more convenient for their operation.
“On this note, we are asking our members to not give in to any act of intimidation or coercion from any Tax Official, who may exhibit such tendency or attitude.”
GUTA warned of reprisal reaction if threats and intimidation are employed on members to exact this new tax.
“In view of all the aforementioned realities of the situation on the ground, it is our fervent hope that the government will carefully and seriously consider all the stated facts and act accordingly.”