Review tax system for construction firms contracted by govt – Contractors to GRA

The Volta Regional branch of the Association of Building and Civil Engineering Contractors of Ghana (ABCECG) has submitted a petition to the Ghana Revenue Authority (GRA), has urged a reconsideration of the taxing system imposed on construction firms engaged in government-contracted public projects.

During a meeting with the Volta Region GRA leadership in Ho, the ABCECG presented their concerns.

The Volta Regional Chairman of ABCECG, Dr. Emmanuel Afetorgbor, highlighted issues such as GRA’s failure to credit members despite recorded credits and the imposition of debits based on “desktop assessments.”

Dr. Afetorgbor raised objections to substantial penal charges for delayed filing of returns and urged the GRA to review this decision.

He also sought clarity on the criteria used for assessing tax obligations and questioned why construction firms faced penalties when government entities failed to remit withheld taxes deducted at the payment source.

“Contractors suffer non/delay payment for works done for the government for several years and when these payments are made, the Government doesn’t pay interest on the said amount. It is very unfair for the government to expect tax penalties and interests when clearly the contractor is not to blame”, he said.

He emphasized the unfairness of imposing tax penalties on contractors who experience delays in government payments for completed projects, especially when the government does not pay interest on overdue amounts.

Dr. Afetorgbor criticized situations where GRA officials humiliate association members for delayed tax payments, asserting that contractors should not be penalized when government agencies fail to remit withheld tax amounts.

“Taxes are withheld at the time of payment and when agencies fail to pay the withheld amounts to GRA, the expectation is for the contractor to further use his resources to chase these payments. GRA doesn’t penalize these establishments for not paying withheld tax amounts to the credit of the contractors.”

“GRA doesn’t seem to want to listen and tailor tax collection to recent happenings in the country.
As one of the major tax-paying sectors of the economy, GRA needs to constantly engage and
educate contractors on changes in their tax collections tactics and also seek input towards effectiveness”, he said.

Calling for immediate redress, Dr. Afetorgbor emphasized the need for collaboration between the GRA and contractors to ensure business sustainability.

He urged the GRA to listen to the concerns of the tax-paying construction sector, engage in continuous communication, and adapt tax collection strategies to the evolving economic landscape.