Minority raises red flags over tax agreements

The Minority Caucus in Parliament has criticised the approval of three tax administration agreements, arguing that although they are intended to improve revenue mobilisation, they raise significant concerns about transparency, foreign involvement and their potential impact on consumers.

These concerns come amid questions about the effect the new e-commerce VAT monitoring platform could have on online shoppers.

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Tano North MP, Dr Gideon Boako, warned that students and other consumers could end up paying VAT more than once on purchases made through international online platforms.

“If you’re a student in Legon or any university, and you want to order a textbook, hair or anything on the Internet, Amazon, or any platform, you’re likely to pay two different VAT,” he cautioned.

While voicing these concerns, Dr Boako maintained that the Minority fully supports the use of technology to improve tax administration and public service delivery.

“We support the use of technology to improve compliance. We support digitalisation of public services. We support measures that reduce tax evasion, strengthen domestic revenue mobilisation and broaden the national tax base,” he stated.

According to him, the Minority’s objection is not to digitalisation itself but to what it describes as a lack of openness in the implementation of the agreements.

“We do not believe in digital opacity and any attempt by any government to hide behind digitalisation to fleece the state. That is why we objected to all of this,” Dr Boako stressed.

The agreements, which cover the Sentinel Cross-Border E-commerce VAT Monitoring Platform, the Ghana Domestic Revenue Collection Platform and the Fiscal Electronic Device Platform, were approved by Parliament after the Majority relied on its numerical advantage despite strong opposition from the Minority.

“The Minority side has in unison rejected all these agreements that the Majority, on the strength of their numbers, have approved,” he said.

He added that although the platforms appear to be separate initiatives, they are designed to operate as one integrated tax administration system.

The Minority also criticised the government’s decision to award the implementation of the platforms to foreign firms instead of relying on local technology companies.

“It’s simply a platform that the government has entered into an agreement that provides a platform with a foreign company,” Dr Boako remarked.

He argued that previous governments successfully partnered with Ghanaian technology firms to deliver major digital projects, making the current approach difficult to justify.

“Unlike times past, where the previous government engaged local Ghanaian IT firms to deploy some of these technologies to help the cause of this country, this government is deciding to cede this to foreign companies,” he said.

Dr Boako further questioned why a technology platform intended to support e-commerce, VAT administration and cross-border transactions had been entrusted to an overseas company.

“This government has come and is going to deploy a technology to help with e-commerce transactions, VAT and cross-border transactions. And the government is going to use a foreign company,” he added.

ANAS/MA

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