Restructuring of GRA Domestic Tax Revenue Division: … an effective approach for tax compliance
The constant feature of any forward-looking organizations is its ability to respond to the challenges and changing trends in the society. In the field of taxation, the ability of tax authorities to quickly identify trends of non- compliance and finding antidote to is a sure means of achieving the set targets.
The tendency of tax paying population to always give excuses for their inability to comply with a tax laws abound. It is therefore imperative for tax authorities to put in mechanism to reduce or eliminate the situation that engenders excuses. With this background, the Ghana Revenue Authority (GRA) being a dynamic institution, has over the years instituted changes and thus modify its operations to conform to current trend of tax administration.
The current developments for example, COVID-19 has taught many such as business owners, private and public institutions and other organizations, the need to be dynamic so as to respond to changes with dispatch. It is against this backdrop that the Ghana Revenue Authority (GRA) since August 2020 has responded to changing times by undertaking restructuring of their DTRD offices and operations in order to enhance their practices to conform to the cannons of taxation.
PRE -RESTRUCTURING ERA
The Domestic Tax Revenue Division (DTRD) of GRA had been structured into Large Taxpayer Office (LTO), Medium Taxpayer Office (MTO), and Small Taxpayer Office (STO) based on the turnover of the taxpayers. The operational functions within the offices were taxpayer services, the compliance, enforcement and debt management unit and the audit unit. The categorization of taxpayers especially into medium and small and creating offices for such a set up brought about challenges for effective compliance.
Key among these challenges was the inconvenience it caused to taxpayers. Some taxpayers cover long distances to transact business with GRA even though there might be a GRA office closer to them.
For example, taxpayers classified as medium taxpayers had to deal with the medium tax office located at Koforidua since the Nkawkaw office is for small taxpayers. It also brought some confusion in the mind of taxpayers who have to pay their taxes in offices with both Medium Taxpayer Office (MTO), and Small Taxpayer Office (STO) at the same premises. There were situations of fluctuating turnover of taxpayers and thus making it difficult to determine where to place such a taxpayer. Others also took advantage of the structure to evade tax.
The new order of restructuring
The Domestic Tax Revenue Division (DTRD) of the Ghana Revenue Authority (GRA) has undergone a restructuring process to improve taxpayer experience and enhance operational effectiveness.
The new structure is still having a Large Taxpayer Office (LTO), the introduction of Areas Offices and Taxpayer Service Centers (TSC). There are currently Ten (10) Area Offices and a number of various Taxpayer Service Centers (TSCs) under the area offices nationwide.
The Large Taxpayer Office (LTO)
The LTO will focus on Large Corporate Businesses, Public Institution and High-Net-Worth Individuals (HNWI). The office located in Accra will serve all large taxpayers across the country. An LTO desk, however will be located in Selected Taxpayer Service Centers (TSCs) outside the Greater Accra Region where there is a concentration of large taxpayers.
The concept of area office is to provide technical and administrative support in the management of the Taxpayer Service Centers (TSCs) in a given tax jurisdiction. The operational activities would also include Centralized Audit and Enforcement functions. This will ensure effective monitoring and enforcement of tax laws. The area office is headed by an Area Manager.
Taxpayer Service Centers (TSCs)
These centers will serve all taxpayers within their areas of operation (both small and medium taxpayers). Thus, payment of taxes to any of these centers would not be dependent on the taxpayer’s turnover except taxpayers at the Large Taxpayer Office (LTO). Thus, the permanent place of business will determine the service centre that will be in charge of tax issues. The TSCs will carry out registration, receiving returns, complaint, enquiries and payment, compliance, debt management and tax education.
Taxpayers in a particular locality will fall under an area office which would have a number of TSCs uner it. For instance, in the Greater Accra Region, there are four (4) Area Offices namely the Adabraka/Agbogbloshie, Legon/Tema, Kaneshie/Achimota and Osu/Spintex Area Offices. Each area office has a number of TSCs under it. For example, the Adabraka/Agbogbloshie Area Office has five (5) TSCs uner it, namely Adabraka TSC 1, Adabraka TSC 2, Nima TSC, Agbogbloshie TSC and Makola TSC.
Ghana at the moment is having sixteen (16) regions, this does not necessarily mean that there would be sixteen (16) Area Offices. However, there would be a number of Taxpayer Service Centers (TSC) across the length and breadth of all the regions of the country. Taxpayers would be assigned to one of these TSCs depending on their location in the county.
THE WAY FORWARD
It is heartwarming to know that GRA is working hard to meet the changing circumstances. The sound object of this restructuring will be achieved if the Authority ensure constant monitoring of the role out. The need for vigorous education to bring taxpayers on board should be a priority. The possibility of elements within and out to resist the changes is real. The ability of management to carry most if not all along this path will enhance revenue mobilization. The changing times demands quick response by GRA to ensure that revenue due the state is fully harnessed. It is thus expected that GRA will reach out to all those who are yet to register for tax purposes. There is therefore the need to liaise with identifiable bodies and unions to reach out to members who are not tax compliant. A re- look at areas such as imported service, on- line trading, delivery services, legal and other professional services, non – issuance of VAT invoices, rent tax, high net worth individuals, etc. will enhance the revenue drive. The potential for the nation to raise more revenue is well established, the time for GRA to explore is now. The GRA is here to help you pay your taxes and remember “our taxes our future”…
The writers are staff of the Ghana Revenue Authority, GRA in Accra. They have 18 years of experience as Tax Auditors and Administrators and were members of the erstwhile Special Revenue Mobilization Task Force of the GRA. You can reach them on Tel No. +233 24 454 2671/ 24 220 5435 or Emails: firstname.lastname@example.org /email@example.com