An Accra High Court, presided over by Justice Afi Agbanu Kudomor, has upheld GH¢19 million tax liability imposed on Scancom PLC (MTN), operators of MTN, by the Ghana Revenue Authority (GRA).
According to the court, the Authority did not err in law when it imposed a Value Added Tax (VAT) liability on Scancom PLC for imported Services between 2014 and December 2017.
The case was determined by the court on November 9, 2023.
According to the court, GRA did not act arbitrarily when it applied the Ghana Educational Trust Fund Levy and National Health Insurance Levy on the imported services by Scancom PLC, irrespective of whether Scancom PLC’s imported services were used to produce Taxable or Exempt supplies.
“It is for these reasons that the instant Tax Appeal fails. There will be no order as to costs, each party is to bear its own costs,” the court said.
Hitherto, the appellant, MTN Ghana, wanted an order reversing the decision of GRA to impose additional VAT of GH¢8,793,598.00 and penalty and interest of GH¢10,933,119 on imported services utilised by Scancom PLC for its telecommunication business.
It further wanted the court to make an order to quash the parts of the current tax assessment relating to the heads disputed assessment and overturn the objection decision by respondent (GRA), as it relates to those parts and others that the justice of the case requires.
In 2020, the Ghana Revenue Authority commenced a comprehensive tax audit on MTN Ghana, spanning the period January 2014 to December 2018.
The audit focused on all aspects of MTN’s businesses, including Input Value Added Tax claims related to goods and services procured by MTN Ghana, Value Added Tax on services imported by the company and Input Value Added Tax claims related to office premises constructed by the telecom giant.
Unhappy about the method used in arriving at the tax liability, Scancom PLC dragged GRA to court, insisting that the authority erred in law and acted arbitrarily by imposing the tax liability order on the company for the period January 2014 to December 2017.
