Ghana Revenue Authority to enforce gifts tax
Ghana Revenue Authority (GRA) will strictly enforce the 15% gifts tax rate on any gift valued at GH¢50 and above, Mrs Freda Badger, Takoradi District Manager, Internal Revenue Service (IRS) of GRA, said on Wednesday.
She said the amendment of the VAT Act 810 in 31st December, 2010, had increased the gifts tax from 5% to 15% and made it mandatory for IRS to charge it on gifts received from loved ones.
She noted that, gifts tax is not only levied on monetary gifts but on bonds, shares, permanent structures and land that were presented as gifts.
Mrs Badger who was speaking at a workshop for traders in Takoradi, organized by GRA to educate them on the amendment of the VAT Act 810, urged the participants to report any gifts received in any form to the Commissioner of the IRS for tax deductions.
She however indicated that not every gift is supposed to be taxed saying gifts from religious bodies and educational institutions are not taxable.
Touching on the 5% withholding tax, Mrs Badger admonished individuals and organisations to keep proper records of all transactions in order to claim them from the IRS.
She said if anyone purchased items totalling GH¢500, the person is supposed to enjoy 5% withholding tax and advised the public to exercise that right.
Mrs Badger stressed that married couples, the aged, persons undergoing training and single parents catering for three children also enjoy tax relief and charged persons who fall within those categories to present the appropriate documentation in order to enjoy tax relief.
She indicated that, the VAT Amendment Act had revoked tax exemptions on real estate developers and hoteliers whilst airport tax had been increased.
Some participants expressed their reservations about the increased in the gifts tax and appealed to the government to reduce it.
They said the increment would prevent their loved ones from showing their appreciation to them especially on festive occasions.
They urged government to rather widen the tax net to cover more businesses in order to mobilize more resources for socio-economic development in the country.
Source: GNA