August 9, 2022
Ghana issues 2022 Mid-year Budget Review Statement
On 25 July 2022, Ghana's Minister for Finance and Economic Planning, Mr. Ken Ofori-Atta presented the 2022 Mid-year Budget Review Statement of the Government of Ghana to Parliament. The Minister outlined the following five tax measures to be implemented by the Ghana Revenue Authority to improve the Government's fiscal outlook.
The major policy initiatives for businesses include:
- The Government expects an increase in the country's revenue from the windfall revenues of the Petroleum Sector. It is likely there will be a resurgence of Additional Oil Entitlements (AOE) demands by the Government from the petroleum contractors as the Government has been focused on the enforcement of the AOE as stipulated in the Petroleum Agreement.
- eVAT – Effective 1 October 2022, the Ghana Revenue Authority will implement an eVAT system to improve Value-Added Tax (VAT) collection through electronic means.
- Property rates – the Government, through the Ghana Revenue Authority, will assist local governments in assessing and collecting property rates.
- Extension of the Tax Amnesty to December 2022 – the Government will extend the period within which a taxpayer can apply for tax amnesty to 31 December 2022 by passing an amendment to the Penalty and Interest Waiver Act, 2021, Act 1065 (as amended) to provide for the relevant period for the tax arrears and returns to be made up. It is likely the existing relevant period of 31 December 2020 will be maintained.
- Introduction of an upfront payment of VAT on importers not registered for VAT from 1 October 2022. It has been suggested that this may operate as a Withholding VAT. What is known, however, is that this is not the import VAT that importers pay at the port of importation. Further guidance is expected from the Minister.
For additional information with respect to this alert, please contact the following:
Ernst & Young Chartered Accountants, Accra
Ernst & Young Société d'Avocats, Pan African Tax – Transfer Pricing Desk, Paris
Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London
Ernst & Young LLP (United States), Pan African Tax Desk, New York