Dr. Gideon Boako writes – WHAT AT ALL IS THE GRA/GOVERNMENT VATing 20%?
I have had people enquire about what specific items/goods/services or transactions would be affected by the 20% VAT on cross-border transactions. Here is what I can think of. To be VATable the following three conditions must be met: – that the payment instruments is issued by Ghana. Example, bank card, MoMo, or digital wallet, – […] The post Dr. Gideon Boako writes – WHAT AT ALL IS THE…
Dr. Gideon Boako addresses the VAT implications of cross-border transactions in Ghana. To be VATable, three conditions must be met: a Ghana-issued payment instrument, the merchant being non-resident, and the service supplied electronically. The goods and services affected by the 20% VAT include video and music streaming, productivity software, cloud infrastructure, AI and cybersecurity tools, digital advertising, online gaming, e-learning platforms, and online travel platforms.
However, hotel room costs from foreign platforms are not explicitly covered, with the GRA still clarifying the split between the hotel room and platform booking fees. App store purchases, while affected, are not new charges for compliant platforms. The VAT applies to intangible digital services and subscriptions, not physical goods imported through e-commerce sites.
The challenge lies in banks incorrectly deducting VAT on physical goods due to lack of differentiation between MID and MCC codes. Incorrect deductions may lead to double taxation and the need for refunds from banks and GRA.
Written by urgent.news from The Chronicle Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
