Lack of supervision and logistics account for low tax collection

Accra, Nov 11, GNA - Mr. John E.K Sotenga, Acting Commissioner of Internal Revenue Service (IRS), on Tuesday told the Public Accounts Committee of Parliament that poor supervision and lack of logistics accounted for low tax collection over the years.

"While in most cases, we do not have vehicles, computers and the personnel to supervise our operations effectively to achieve our goals, we sometimes do not do effective monitoring due to the same reasons".

Mr. Sotenga, who appeared before the committee to answer questions on some findings and recommendations of the 2006 Auditor-General's report, gave the assurance that adequate measures were now put in place to reverse the trend as it had denied the country substantial finance that could have been used for so many development projects in deprived areas.

The Committee, which resumed its public hearings on Tuesday, featured income generating organizations such as Internal Revenue Service (IRS), Value Added Service (VAT), National Lotteries Authority (NLA) and Customs, Excise and Preventive Service (CEPS). Institutions under the Ministry of Education and Interior that were also billed to appear before the Committee were however told to go and return on a later date as it was too late to attend to them. He said in the past years, most of the holding companies especially building contractors had failed to honour their tax obligations and those of their workers.

They claimed they had not been paid for the jobs they had executed adding "we have reminded them that failure to pay tax promptly can attract 30 percent penalty." He said they had not been able to improve on property rate collection because of dishonesty from property owners when he was asked why an Auditor-General report stated that 62 percent of landlords and landladies in NIMA were not paying property rate. Mr. Sotenga said they had identified all the difficult communities in the capital and were therefore mapping out strategies to collect tax effectively in those areas.

"We are focusing so much on rent because it has come to our notice that most landlords and landladies enjoy some much at the expense of the state". Mr. Seth Terkper, a Deputy Minister of Finance and Economic Planning, said the Ministry was undertaking numerous reform exercises in all the revenue generating organizations to ensure efficiency and increased revenue in the coming years.

He mentioned some of the reforms as uniform budgeting and financial accounting in all the Metropolitan, Municipal and District assemblies and strengthening of internal controls in various income generating services. Mr. Terkper said effective measures were also undertaken to address tax and customs administration in the country and to ensure that legislation on proper record keeping was effected to step up tax collection. Mr. Frank Jones Abban, a Deputy Commissioner of CEPS who could not provide answers to some of the issues raised in the Auditor-General's report, was tasked to furnish the committee with all the necessary information before the close of this week. 11 Nov. 09