The Ghana Union of Traders’ Associations (GUTA) is warning that the government’s new Value Added Tax (VAT) reforms will hit small and medium enterprises hard and distort competition across the country’s markets.

The Association says the sudden shift from the 4% flat rate to a 20% VAT for many traders will be devastating.

In a statement issued on November 18, GUTA’s First Deputy Secretary General, Richard Amamoo, said the Union is observing “with grave concern” the challenges that will emerge from the new regime.

He said GUTA “acknowledge and welcomes measures aimed at enhancing tax compliance and improving revenue collection,” but stressed that the reforms come with serious unintended consequences.

Mr Amamoo said the new threshold of GH¢750,000 creates a market split that will “segregate” traders.

Source: Abubakar Ibrahim