Some Tax Analysts are pushing for a legislation that will ensure that government deals extensively with companies that involve in transfer mispricing.
They insist the action remains a major challenge which has to be dealt with if government wants to attain its set revenue target for the year.
Transfer pricing is the rules and methods for pricing transactions within and between enterprises under common ownership or control.
The Ghana Revenue Authority had some years past hit hard at companies for practicing transfer mispricing which dwindles the country’s profit income.
In an interview with Citi Business News at the sidelines of this year’s edition of the Crystal Ball Africa conference organized by AB & David Africa in partnership with Barclays, Tax Analyst Isaac Nyame said stakeholders must put in place regulations to ensure companies are dealt with should they be caught in such acts.
“This issue must be legislated in such a way that people can stop avoiding and put in place anti avoidance regulation to stop people from engaging in transfer mispricing. Because the price that is charged is very key to taxation. The higher the price in our country, the likelihood that we will get more money to tax for purposes of development” he stated.
“Because it is an international issue, there are action plans that is required of every country. They need to ensure that they put in place regulations and legislations that will ensure that even if they are going to do transfer of goods and services among themselves, those transfers are available in the open market” Mr Nyame reiterated.
He explained that “In the wake of transferring goods among themselves, companies would basically charge the services that is lower so they can make more profit in that other jurisdiction across the country”.
He added that the rest of the money remains in that jurisdiction and they deny Ghana the rights to tax that money that should have been taxed in Ghana.
By: Jessica Ayorkor Aryee/citibusinessnews.com/Ghana