The Ghana Chamber of Telecommunications is demanding evidence of an allegation by Communications Minister, Ursula Owusu-Ekuful, that telcos hid GHâ‚µ300 million taxes from the state between 2015 and the first quarter of 2017.
At a press conference recently, the Communications Minister alleged that prior to the implementation of the common platform for the real-time monitoring of telcos’ revenue flow, the state lost GHâ‚µ300 million due to under-declaration by telcos over the said period.
She stated that the said under-declaration of revenue was discovered by the common platform, which subsequently ensured some GHâ‚µ470 million savings in VAT and other consumer taxes since inception in 2017.
But the CEO of the Chamber, Ken Ashigbe, told journalists at the Chamber’s end of year media engagement that they were surprised to have heard the Minister put such information out without showing it to the very telcos she claimed under-declared revenue.
“We have not seen any such report – and when it comes to taxes we deal with the Ghana Revenue Authority (GRA), not the Communications Ministry, so we have written to GRA to provide us a report of the said evidence – we copied the Communications Minister,” he said.
He said telcos are key partners in the implementation of the common platform and so it is surprising that such sensitive information is allegedly emerging from the platform and telcos are completely in the dark about it.
Ken Ashigbe noted that even though every GHâ‚µ1 telcos make, 40Gp goes to the government in taxes, telcos are very strict on themselves when it comes to paying taxes so the Minister’s claims came as a surprise to them.
“Taxes are not something we take for granted at all so we are not treating this matter lightly because those claims go to the very core of our reputation,” he said.
He noted that contrary to the years of repeated claims that telcos under-declare revenue and hide taxes, the industry continues to contribute immensely to the government’s tax revenue every year.
Indeed, recently the Chamber released a report indicating in 2018 alone, telcos paid a whopping GHâ‚µ2.2 billion in taxes, representing some 9 per cent of government total revenue basket.
They noted that out of the total, Communication Service Tax (CST) topped with GHâ‚µ420 million, followed by Value Added Tax (VAT), GHâ‚µ413 million; Corporate Income Tax (CIT), GHâ‚µ343 million; Withholding Tax (WHT), GHâ‚µ293 million and Import Duties, GHâ‚µ180 million.
The rest are Surcharge on International Incoming Traffic (SIIT) GH¢155 million; SIIT is the quantum of six cents per every minute of call that comes from overseas into the country.
The Chamber also noted that in 2015, the year the Minister claimed telcos hid taxes, they paid a whopping GHâ‚µ1.4 billion in taxes, and in 2017, the paid GHâ‚µ1.74 billion.
They argued that the figures clearly show that taxes from the industry keep growing organically without any state intervention.
Ken Ashigbe said every year, CST and VAT top in the amount of taxes telcos pay, so they are surprised that the Minister would claim that telcos under-declared revenue and government lost GHâ‚µ300 million in CST and VAT for those two years.
He is of the fervent hope that the GRA will do the right thing by providing the said evidence of under declaration of revenue by telcos over the period the Minister alleged, and then they will take it from there.
Indeed, the Minister failed to mention any telcos’ names, except to put them all in one bracket and claim that the common platform discovered that telcos under-declared revenue.
This would not be the first time a government had accused telcos of hiding revenue without providing any substantial evidence to back the claim. But this is the first time a Minister has openly claimed that the government has discovered a specific amount hidden from it in taxes by telcos.
The Minister has been challenged to provide the hard evidence, name the defaulting telcos and actually take legal action against them with the evidence in hand.
She is yet to do any of that, while the Telecoms Chamber is also yet to receive responses to its query to GRA.