GRA forms 43-member rent tax team

The Ghana Revenue Authority (GRA) has constituted a 43-member rent tax team to help unearth new properties not yet identified and covered for tax purposes and to gather information from landlords and tenants.

The information gathered by the team will be sent to the rent desk for action.

For now, the team will concentrate its work in the Greater Accra Region and later extended to other parts of the country.

Mr George Blankson, Commissioner-General GRA, who announced this at the re-launch of tax on rent income in Accra on Tuesday, said the rapid growth in the housing sector has not matched with the revenue from the sector.

He said a recent survey had shown that the tax on rent income for 2011 was 0.42 per cent or GH¢ 15.92 million out of GH¢ 3.7 billion of total direct tax collected.

In 2012, the amount realised for rent income was GH¢17.48 million out of GH¢5.4 billion total direct taxes.

“This is obviously not a healthy development. It is for this reason that the management of GRA has found it necessary to re-double efforts to scale up the collection of the tax on rent income,” Mr Blankson said.

He said the GRA would undertake public education to deepen the awareness on the need to honour their rent tax obligations.

Owners of residential and commercial premises, who receive income from the letting or leasing of property would be obliged to pay the tax on rent income at the rate of eight per cent of the gross rent income.

Mr Cassiel Ato Forson, Deputy Minister of Finance, said the re-launch had come at the right time when government’s expenditure has increased in order to meet development aspirations.

“As you are no doubt aware and as indicated in the 2013 budget statement and economic policy document submitted to parliament, the focus of revenue generation in 2013 is to expand the tax base and improve the efficiency of tax administration,” he said.

He asked members of the rent tax teams that the success of the exercise would depend on their commitment and asked them to shun negative practices and avoid being influence by property owners.

Mr Ernest Kwesie, Board Chairman GRA commended the management of GRA for taking the initiative to bring to life a tax type that has so much potential and yet has underperformed in the past.

He urged GRA to sustain the momentum after the re-launch to enable it derive the full benefit from property owners.

Source: GNA