Penalty and Interest Waiver Act 2021 (Act 1065)
Introduction
The Penalty and Interest Waiver Act 2021 (the “Act”) was passed by Parliament and assented to by the President on the 31st March, 2021. The scope of the Act is to “grant a waiver of penalties and interests on accumulated tax arrears up to December 2020 for persons who make arrangements with the Ghana Revenue Authority for payment of the principal tax by 2021and to provide for related matters.” This document will outline the key provisions in the Act.
Application and Grant of the Waiver
To obtain this waiver, persons who qualify under the scope of the waiver must between 1st April, 2021 and 30th September, 2021, submit a written application to the Commissioner-General in a form so prescribed by him, and submit outstanding returns in respect of previous years up until the 31st December, 2021.
Within 30 days of this submission, the Commissioner-General is required to serve the applicant with notice of the Commissioner-General’s decision regarding the application. Where the application for the waiver is refused, the Commissioner-General is required to outline the reason for the refusal in writing.
An applicant who is dissatisfied with the decision of the Commissioner-General may lodge a written complaint with the Commissioner-General within 30 days of receipt of the decision. The Commissioner-General is required to make a determination and notify the applicant accordingly. Where the applicant is dissatisfied with this subsequent determination, he may pursue the matter in a court of competent jurisdiction.
Terms of Payment and Remission of Taxes
Terms of payment of an assessed amount and outstanding tax arrears may be granted and determined by the Commissioner-General. Importantly, the Act does not derogate from the power of the Commissioner-General to remit taxes under an enactment administered by him.
Conclusion
The Act provides relief to taxpayers who for one reason or the other were unable to pay taxes, been in arrears or have not yet registered with GRA. With the enactment of this Act, individuals and companies with the assistance of their legal and tax advisors determine their tax liabilities and negotiate a payment plan for such outstanding taxes. This will draw more individuals and companies into the tax bracket while existing taxpayers will be able to meet their tax obligations in a manner that is convenient for them. Ultimately, if this process is well managed it will be a “win-win” situation for both the taxpayer and the tax collector.
