More
than 10 Licensed Buying Companies (LBCs) are suing the
Ghana Revenue Authority (GRA) for what they claim to be the authority’s
insistence on collecting Value Added Tax (VAT) from them.
Apart
from the GRA, the suit which was filed yesterday cites the Commissioner-General
of the GRA as well as the Ghana Cocobod and its Chief Executive Officer as the
defendants. The plaintiffs want the court to order the authorities to exempt
them from the payment of VAT.
The
plaintiffs include Kuapa Kooko Co. Ltd, Federated Commodities Co. Ltd, Sika Aba
Buyers Ltd, CDH Commodities Ltd, Adikanfo Commodities Ltd, Olam Ghana Ltd, Unicom
Commodities Ghana Ltd, Licensed Cocoa Buyers Ass. of Ghana (Licobag), Agroecom
Ghana Ltd, Nyonkopa Cocoa Buying Ltd, Cocoa Merchants Ghana Ltd and M. Ghazalli
Ltd.
They
are seeking a declaration that “the activities of trucking and haulage of
agricultural products, including cocoa, coffee and sheanuts in their raw state,
form part of a chain of many procedures
and processes of the supply of agricultural products in their raw state and
therefore exempt from VAT.”
They
also want a declaration that “the plaintiffs and other LBCs who by their
operations engage in supply procedures and processes including trucking and
haulage of agricultural products in their raw state are exempt from audits,
valuations, assessments and payment of VAT.”
To
the plaintiffs, “the purported or effective selection or sampling of the plaintiffs
and other Licensed Buying Companies (LBCs) for audits and assessments for the
purposes of levying Value Added Tax (VAT) on them or any completed assessment
for the payment of VAT by the plaintiffs is arbitrary, inequitable,
unreasonable, unfair, capricious, in bad faith and therefore unlawful, null and
of no effect,” and want the court to declare as such.
They
said, “ By virtue of the agency relationship between the plaintiffs (and other LBCs)
and the Ghana Cocoa Board; and/or by virtue of the role played by the
plaintiffs and other LBCs in relation to the Ghana Cocoa Board, any audit
and/or assessment of the plaintiffs or any other LBCs for the payment for Value
Added Tax (VAT) that leads to any tax liability on the plaintiffs is a liability
incurred by the plaintiffs on behalf of the Ghana Cocoa Board; and, therefore,
the 3rd defendant (Ghana Cocoa Board) is ultimately liable to be discharged any
such VAT liability.”
They
are, therefore, asking for an order of perpetual injunction restraining the GRA
“from ever auditing, purporting to audit, assessing or purporting to assess the
plaintiffs for the purposes of charging the plaintiffs to pay Value Added Tax
(VAT).”
The
plaintiffs also want an order for Cocobod “to fully indemnify and compensate
adequately the plaintiffs on a full cost recovery basis for all Value Added Tax
(VAT) purported to be assessed, actually assessed, charged and paid by the plaintiffs
to the GRA,” payable with interest.
In
their statement of claim, the plaintiffs said that they were companies
registered under the laws of Ghana and carry on business in the agricultural
sector (specifically Cocoa, Shea and Coffee) as
LBCs authorized by the Ghana Cocoa Board Act, 1984 (PNDCL 81) to
purchase cocoa for and on behalf of the Ghana Cocoa Board.
The defendants are yet to file a response in the case.
By Gibril Abdul Razak
