21
Menu
News

Using Ghana card for all financial transactions will broaden tax net – Economist

Ghana Card121212 Ghana card will be used for all financial transaction effective July 1

Sun, 23 Jan 2022 Source: GNA

Economist, Dr Patrick Asuming, says the usage of Ghana card for all financial transactions will help in widening the tax net.

Dr Asuming, who is a senior lecturer at the University of Ghana (UG), said the decision would also support the country’s revenue generation efforts for national development.

In an interview with the Ghana News Agency, the economist said the card could help track economic activities and close the loopholes in the informal sector.

He said the move would give the Ghana Revenue Authority (GRA) the opportunity to tax and also go after individuals and organizations that evaded tax payment.

“It will help have a stronger footing to track the kind of economic activity people are involved in, and be able to tell when people are not paying their taxes and go after them,” Dr Asuming said.

Citing the United States of America (USA) where a similar system was in place, he said, each time someone went to rent a house, buy a car, or do a major investment, their social security number was required.

Therefore, at the end of the year, the bank would have the information about all transactions made, together with the interest income earned by the individual and send the same information to the Internal Revenue Service (IRS) for action to be taken.

“In our case, the Ghana card is the tax identification number (TIN). So GRA will have the Ghana card number as our tax ID and every time there are transactions in your bank, GRA will know that TIN is performing this transaction.

"So if at the end of the year they crosscheck their records and realise that even though GHC100,000 million went into your account, there’s no record that you filled any tax and paid, then it means that you’d be made to go and pay your appropriate tax,” he said.

That, he noted would widen the tax net and help generate more revenue.

Mr John Awuah, the Chief Executive Officer (CEO) of the Ghana Association of Bankers (GAB), said the integration of all cards into the Ghana card would help “tax agencies to be able to follow the money.”

“If everything is tied to one card that gives visibility to the tax authority, it can only be a positive development for tax collection. This will, therefore, help with the Government’s revenue mobilisation plan,” he said.

He also said there would be sanctity in the banking system because the banks would be able to detect fraudulent activities perpetrated by people who would temper with IDs that did not belong to them.

He, therefore, said the community of banks was ready to work with the stakeholders to ensure that the timelines were met to make customers comfortable.

Source: GNA
Related Articles: