William Demitia - Lecturer, UG School of Law
A Tax Law lecturer, William Demitia at the University of Ghana School of Law has said that the government deliberately announced tax reliefs for the COVID-19 Fund donors to entice more people to support the fund.
According to him, the stated objective is to get more people to donate to the Fund, and in turn, provide more help to persons who have been worst hit by the coronavirus pandemic.
Chairperson of the COVID-19 National Trust Fund, Sophia Akuffo, on Tuesday, May 26 noted that all companies that have donated to the national fund will enjoy some tax reliefs when they report at the Ghana Revenue Authority (GRA) to file their tax returns. According to her, the move by the GRA is aimed at rewarding companies and institutions that responded to calls for a national fight against the COVID-19 outbreak.
While sharing his thought in an interview, the tax analyst lauded the government for this move but further asked that Ghanaians should focus on ensuring that all these moves achieve the intended purpose of catering for the needy in these times.
“Tax is not only imposed to raise revenue. There are times tax is imposed to achieve government’s objective. In government, coming out to provide tax reliefs, government is achieving a social objective and not necessarily raising money, but getting individuals to be able to donate towards a course that will save all of us and the greater society. It may not be entirely appropriate to tag it as politically right and economically wrong but it is supposed to achieve a particular objective and our job is to interrogate whether that objective is good and whether the mechanisms put in place to ensure that, that policy is achieved.”
He further said:
“We must remember that we are in a crisis where there is a need to bring in efforts to ensure that the quality of human life is preserved. It is a cause that you have to support but we must ensure that the right checks and balances are in place to ensure that the reliefs get to the targeted persons.”
Tax reliefs for Ghanaians amid COVID-19
As part measures to mitigate the economic burden on taxpayers as a result of the coronavirus, the Ghana Revenue Authority (GRA) earlier announced that taxpayers who redeem all their outstanding debts due to the Authority by June 30, 2020, will be granted a remission of penalties on their principal debts. These measures, according to the GRA, are to ensure that taxpayers fulfil their tax obligations during the period.
The Authority also scheduled the month of June to be the Annual Tax Month for 2020 instead of April. Also, the GRA said it will permit the deduction of contributions and donations towards COVID-19 as allowable expenses for tax purposes and taxes on selected third-tier pension withdrawals will be waived.
President Nana Akufo-Addo also announced a tax holiday for health workers in the country for three months, from April to June 2020.
This was effected by the Controller and Accountant-General’s Department days after it was announced. The department further explained that it is still working out modalities for effecting the payment of the additional allowance of 50 per cent of their basic salary per month.