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Business News Tue, 30 Jun 2020

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Petroleum sector revenue shortfall worries govt

A provisional report on revenue mobilized by the Ghana Revenue Authority (GRA) for May 2020 showed a deficit of 8% of total tax revenue, of which petroleum taxes had a deficit of 16.24%.

Finance Minister Ken Ofori-Atta, who disclosed this recently at the launch of a project to determine earnings on Ghana’s petroleum supplies in Accra, reiterated that there had been a harrowing picture of malfeasances perpetrated in the sector and that total taxes evaded between 2015 and 2018 stood at GH¢1,390.70 million, whilst the total under-reported taxes stood at GH¢1,168.33 million.

According to him, revenue growth for the petroleum sector decreased from 4.71% in 2017 to 4.23% in 2019 for petroleum levies, and 3.73% to 3.55% for Special Petroleum Tax (SPT).

He said Ghana lost a total of GH¢2,559.06 million in taxes from 2015 to 2018.

“Combined with the evaded regulatory margin of GH¢231.53 million, a total of GH¢2,790.59 million was lost to the nation in taxes and regulatory margins for the period 2015 to 2018,” he revealed.

Besides, Mr. Ofori-Atta maintained that recurrence of the under-reporting of tax receipts had been a concern to government since these actions continue unabated.

According to him, these illegal activities have been possible largely because of the absence of adequate visibility on the actual quantities of fuel that arrive in the petroleum depots through the ports and the actual quantities that leave the depots.

“To stem the tide of under-reporting, diversion and dilution of fuel products and general non-compliance in the petroleum downstream sector, which cause government to lose considerable revenue, it was indicated in the 2020 budget statement that the spotlight would be turned on the sector to address these irregularities,” he said.

He averred that there was the need for strategic stock movement monitoring in the sector to ensure the optimization of revenue mobilization.

He, however, stressed that government would continue to enforce the withholding tax on precious minerals, assuring revenue through the Audit and Quality Assurance Department, securing collection of government revenue through the introduction of a centralized payment platform.

“The introduction of this monitoring system and a plethora of available measures will ensure government gets enough to plug the 12.5% deficit,” he added.

Source: Daily Guide Network

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