Digital VAT collection to cover mobile payments, not just bank cards – GRA
The Commissioner-General of the Ghana Revenue Authority (GRA), Anthony Kwasi Sarpong, says the digital VAT collection system will cover qualifying payments made through mobile and other digital payment platforms, beyond transactions involving bank cards.
The Ghana Revenue Authority (GRA) Commissioner-General, Anthony Kwasi Sarpong, announced that the digital VAT collection system will extend to encompass mobile and other digital payment platforms, not just bank cards. Speaking on Joy FM’s Super Morning Show, Sarpong detailed that the mechanism will capture qualifying foreign digital services processed through banking and digital payment systems.
He clarified during the discussion on the 20% tax applicable to services such as Netflix and Spotify subscriptions. "It's not only for a card. Assuming you are also using your mobile to pay, that will also be captured," he stated. The system would separate the tax component from the provider's share at the time of payment processing.
Any digital payment platform used at the point of payment would split the value into two: the tax component would go to a government account, while the remaining amount would be paid to the merchant or service provider. Mr Sarpong explained that this arrangement would enhance the GRA's ability to track transactions and collect taxes currently remitted by foreign providers.
Using Netflix as an example, he clarified that the Authority currently relies on the company to declare transactions and the corresponding VAT due. The new system would provide the GRA with an independent record of the number and value of payments and the applicable tax. The change in collection would not add an extra 20% to subscriptions, as the tax is already embedded in the prices.
About 92 foreign companies currently remit VAT, and the reform would not alter their pricing. However, the GRA aims to bring approximately 100 additional providers that are not currently charging VAT into the system gradually. The Real-Time VAT framework covers electronically supplied services from non-resident providers paid for using Ghana-issued payment instruments, such as cards, mobile money accounts, and digital wallets.
Services covered include streaming subscriptions, cloud computing, online gaming, and digital advertising.
Written by urgent.news from Joy Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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