GUTA alleges traders receiving threats over new VAT rollout

The President of the Ghana Union of Traders’ Associations (GUTA), Clement Boateng, says traders across the country are receiving what he describes as threatening messages from the Ghana Revenue Authority (GRA) regarding the rollout of the new Value Added Tax (VAT) system.

Speaking on Adom FM’s Dwaso Nsem, Mr Boateng said he has been inundated with calls from members nationwide after the GRA directed traders to return their old 4% VAT flat-rate booklets and enrol onto the new 20% VAT regime.

“The number of calls I receive each day from members is alarming. Members are calling me from all over Ghana because the GRA has asked them to surrender the four percent book and enrol onto the 20% system,” he said.

According to him, the enforcement approach adopted by the tax authority is creating fear and uncertainty within the trading community.

“People are already receiving messages that the GRA will soon storm the markets with its task force to enforce the new VAT regime,” he added.

Mr Boateng advised traders not to rush into compliance under pressure, arguing that tax policies should reflect business realities and encourage voluntary compliance.

“I have told them nobody should surrender under intimidation. Laws are made for people, not people for laws. Taxes should be affordable and flexible so compliance will be high. Otherwise, many will evade, and the revenue targets will not be achieved,” he stated.

He further warned that aggressive enforcement of the new VAT system would ultimately pass the cost burden onto consumers.

“If this takes effect in this manner, the consumer will suffer the consequences. No businessman is Father Christmas,” he said.

Mr Boateng also raised concerns about the broader economic implications, noting that market conditions are already fragile. He observed that while prices have recently declined in response to economic trends, the introduction of the new system could reverse that progress.

“Everyone can see the current microeconomic indicators. Prices have gone down, although some traders are yet to adjust. If this system is implemented abruptly, prices will rise again,” he cautioned.

Under the GRA’s new VAT framework, the previous 4% flat-rate system applied to certain traders is being replaced with a standard VAT rate of about 20%, with provisions for full input tax deductibility. The policy aims to streamline tax administration, expand the tax base, and enhance revenue mobilisation.

However, spare parts dealers and market traders—particularly at Abossey Okai and other major trading centres—have expressed concerns that the transition could disrupt business operations and lead to higher prices if not carefully managed.

GUTA is therefore urging the GRA and government to engage traders in a more transparent and respectful manner, warning that intimidation and abrupt enforcement could undermine compliance and destabilise the market.

Mr Boateng emphasised that cooperation, rather than threats, is essential to ensuring successful tax reform within Ghana’s informal and semi-formal trading sectors.