In an effort to enhance tax compliance among young entrepreneurs, BudgIT Ghana, in collaboration with Oxfam in Ghana and the International Budget Partnership (IBP), organised a Tax and Legal Clinic for Student Entrepreneurs at the University of Professional Studies, Accra (UPSA) on Friday, March 14.
Under the theme “Accelerate Action for Gender Parity,” the event brought together students, tax experts, and financial service providers to discuss critical tax obligations and legal frameworks for businesses in Ghana.
Mr Victor Akogo, Chief Revenue Officer and Head of Compliance at the Domestic Tax Revenue Division of the Ghana Revenue Authority (GRA), led an informative session on the responsibilities of taxpayers, emphasising the importance of registration.
“One of the four obligations of a taxpayer is to register. First, you must register with the Ghana Revenue Authority (GRA) and acquire a tax identification number. For individuals, your tax identification number now serves as your Ghana Card PIN, which you use to pay your taxes,” he explained.
He highlighted the GRA’s efforts to streamline tax payment processes through the Taxpayers Portal (www.taxpayersportal.com), urging all taxpayers to take advantage of the online system to fulfil their obligations efficiently.
Mr Akogo further outlined the various tax types applicable to businesses, including personal income tax, corporate income tax, pay-as-you-earn (PAYE), and withholding tax.
“If your business grows and you supply goods or services to a third party, the law requires the purchaser to withhold 3% of the payment to you. This withholding tax is a payment on account,” he noted.
Additionally, he reminded attendees about other taxes such as VAT, rental tax, and the communication service tax, which contribute to national revenue generation.
Tax Reliefs and Exemptions
To encourage tax compliance, Mr. Akogo detailed some tax reliefs available to individuals and businesses.
“Residents who support a spouse or at least two children are entitled to a marriage/responsibility relief of GH₵1,200 annually. Additionally, those paying school fees for their children can claim a Child Education Relief of GH₵600 per child for up to three children,” he stated.
Other personal tax reliefs include Disability Relief (25% of income), Old Age Relief (GH₵1,500 for individuals aged 60 and above), and Mortgage Relief for homeowners. He also mentioned corporate tax exemptions for government income, pensions, and cocoa farming earnings, as well as tax incentives for strategic investment projects under the Exemptions Act, 2022 (Act 1083).
Promoting Voluntary Compliance
Mr Akogo underscored the importance of voluntary tax compliance in national development, urging all Ghanaians to fulfil their tax obligations to reduce reliance on external borrowing.
“Ghana generates revenue from two main sources: taxes and loans. However, the country has accumulated excessive loans, leading it to focus more on accelerating domestic revenue mobilisation. I believe that all Ghanaians earning employment income, business income, or investment income must voluntarily and honestly disclose their earnings, file their tax returns, and pay the appropriate taxes on time,” he emphasized.
He also warned against tax evasion, noting that failure to file tax returns attracts penalties and legal consequences.
“Failure to file a tax return on time attracts a penalty of GHS 500 on the due date, plus an additional GHS 10 for each day of default. Persistent non-compliance may lead to prosecution for tax evasion,” he cautioned.
A Gender-Focused Initiative
Dr Angela Azumah Alu, fiscal policy adviser at Oxfam in Ghana, explained the rationale behind the clinic, highlighting the focus on young women entrepreneurs.
“Even though International Women’s Day is past, our focus was on young women. Interestingly, out of the over 100 students who registered, about 70% were female. To ensure proper representation, we invited the Society of Women in Taxation to participate,” she noted.
The event featured a panel discussion that included representatives from the tech industry, municipal assemblies, and gender advocacy groups, providing diverse perspectives on taxation and business compliance.
Additionally, the clinic offered students the opportunity to open accounts with Fidelity Bank and Opportunity International, as well as receive mentorship from the Society of Women in Taxation.
Projecting forward, Dr Alu expressed hope that the clinic would spark further conversations on tax compliance among young entrepreneurs.
“Our hope is that today marks the beginning of many similar conversations. As more young people become informed—whether through direct participation or by hearing from their peers—we hope they will see the importance of tax compliance in both their personal lives and businesses.”
