Ghana: New system widens tax net

The Ghana Revenue Authority (GRA) introduced a new tax system, requiring all Ghanians to have a Tax Identification Number (TIN) on April 1.

Without a TIN Ghanaians cannot apply for passports, register land, clear goods, register a vehicle or apply fordriver's licenses. Obtaining a payment from a government agency, opening a bank account or bidding for a contract without it is also impossible. 

The goal of the new system is to introduce tighter controls to ensure that taxes are paid on all earnings. But the new directive is very unpopular, especially among people working in the informal sector.

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Concerned locals

Bawa Kweku, who works as a nurse in Tamale, told DW that he is afraid of running into trouble unless he registers for a TIN.

"I have been told that without the TIN I wouldn't be able to access my salary. And then there are other transactions that I will not be able to transact without the TIN. So that has encouraged me to come and then register for it."

The TIN can be obtained within 24 hours after showing a valid passport, voter ID or a driver's license. This is to ensure tax compliance and widen the tax net.

Another local resident, Alex Gyanfi, told DW he was registering for a TIN in order to apply for a passport.

"It is a requirement now at the passport office because I went for renewal and I was told that without a TIN number I can't I have a new passport, so it was a surprise to me and a challenge as well."

The Ghana revenue authority's clients' officer, Doris Kotuah, explained to DW that the TIN is very important for everyday life of any Ghanaian.

"Without the TIN, you can't do anything in Ghana. You can't open an account, you can't register for your passport, you can't even renew your driving license or have a new license. You can't register your land without the TIN. You can't do any business in Ghana without the TIN."

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How it works

Registration for a TIN is free for every Ghanaian and the Revenue Authority has established registration centers across the country. Alhaji Aminu Sulemana Sachibu, head of the Ghana Revenue Authority in Tamale, told DW that each person is given an individual number.

"It is unique to everybody and it is an 11 digit number."

The GRA says this approach is part of a national drive to ensure tax compliance. Ghana has an estimated six million employees but only one million individuals are registered to pay tax.

There are many in the community who think the policy implementation has been too sudden. Local resident, Alhassan Ziblim, is critical of the new system.

"People with deadlines are bound to miss a lot of critical business transactions because if you are supposed to process a passport within 24 hours to travel and then you have to go and process a TIN obviously you are not going to meet the deadline. So this is where I think the sudden implementation of this policy has a problem."