GRA closes down Tema fishing company for tax evasion(Saturday, March 9, 2013, Pg 3))
The Ghana Revenue Authority (GRA) has closed down Unique Concerns Ghana Limited, a cold store company in Tema, for failing to live up to its tax obligations for the past six years and also falsifying import duties/tax documents.
The company, which owes the state GH¢4.1 million in taxes, also had all its properties attached and would not be released until it pays all the debt within 21 days.
Additionally, the local head of the company, Mr Muhammadu Muzzamil, has been invited by the police for questioning regarding the falsification of trade documents, notably bills of lading, invoices and import declaration forms.
With the distress warrant issued by the Commissioner General of the GRA in its hand, a team of officials from the Debt Management and Compliance Unit of the authority arrived on the company’s premises at exactly 10.10 a.m.
On presenting copies of the warrant to Mr Muzzammil, the team demanded payment of the amount or have the company closed down until full payment was made.
When the company failed to pay the amount, officials of the GRA took inventory of all the company’s assets, including its office buildings, cold stores and two vehicles, a Nissan Sunny, with registration number GN 1762-12, and a Honda Accord, with registration number GE 1488 Z, before closing the company down.
According to officials of the GRA, the company had been issued several demand notices to settle its debts but to no avail.
But, speaking with the media, Mr Muzzammil said at the time the debt was incurred, a different management was in charge of the company.
He said the company would investigate how that a flaw occurred and even ask for a re-audit to establish the veracity of the claims of the GRA.
“If it is a flaw from our side, I am sure as a commitment to the nation we will put in all efforts to pay back to the government within the stipulated time,” he said.
“We will have to get a clear understanding as to why this amount has accrued. It is something pertaining to 2006/2007 at the time when most of us here were not here. We have to go back to our archives and records and try and understand what has been paid to the government and what is liable to us,” he added.
He said while that was not the first time the company had been notified about its tax obligations, the last time the management received notification was 2008, adding that that was an issue which concerned almost all fishing companies in the country.
But sounding rather sceptical, he said, “I don’t know why this is cropping up again; I believe that at that time it was settled. We have to check transaction by transaction because this is not a small amount. We have to get to the bottom of it. From our side, it is our duty to pay, but at the same time it is a moral responsibility to know if we actually owe this amount.”
However, in a sharp rebuttal, a Principal Revenue Officer of the GRA, Mr Gershon K. Akpabli, giving a historical account of events leading to the present situation, said in 2008 the Revenue Protection Unit (RPU) of the erstwhile Revenue Agencies Governing Board received information that some fish importers and their agents had been engaged in fraudulent deals at the Tema Harbour from January 1, 2006 to December 31, 2007.
Subsequently, the complaints of malfeasance revealed that some fish importers forged trade documents covering their bills of lading, invoices and import declaration forms, changed port of landing from Mauritania and Guinea to Namibia and, in the process, obtained lower values from Gateway Services Limited, instead of BIVAC Ghana, which was the authorised inspection company for Mauritania and Guinea.
Those actions benefitted the companies involved because at that time fish was cheaper in Mauritania and expensive in Namibia.
To deal with the matter, the RPU hired the services of an international shipping consultant who tracked the movement of all the vessels that conveyed fish from Mauritania to Ghana from January 1, 2006 to December 31, 2007.
Mr Akpabli said after a careful analysis of the report submitted by the consultant, “the unit established that trade documents used by Unique Concerns Limited, among other fishing companies, in clearing some consignments of fish imports were falsified”.
In view of that, BIVAC Limited re-assessed all those transactions to reflect the true cost, insurance and freight values, revealing under payment in duties/taxes amounting to GHc1,956,021.
The GRA imposed a penalty of a 100 per cent, bringing the total customs duties/taxes to GH¢3,912,043.
He said the action to close down the company was a last resort and in conformity with sections 241 and 279 of the Customs Excise and Preventive (Management) Law 1993 (PNDCL 330) which mandates the commissioner general to attach the assets belonging to the company.
He said the GRA would auction all the company’s assets if it failed to pay all debts within 21 days.
He warned all importers who falsified custom declaration forms with the intention of reducing duties/taxes to stop the act, adding that the law would be ruthless with any person caught by the law.
Mr Akpabli said a number of companies were engaged in such falsification of custom declaration forms and stated that the GRA would stop at nothing to retrieve amounts owed the country.
The company, which owes the state GH¢4.1 million in taxes, also had all its properties attached and would not be released until it pays all the debt within 21 days.
Additionally, the local head of the company, Mr Muhammadu Muzzamil, has been invited by the police for questioning regarding the falsification of trade documents, notably bills of lading, invoices and import declaration forms.
With the distress warrant issued by the Commissioner General of the GRA in its hand, a team of officials from the Debt Management and Compliance Unit of the authority arrived on the company’s premises at exactly 10.10 a.m.
On presenting copies of the warrant to Mr Muzzammil, the team demanded payment of the amount or have the company closed down until full payment was made.
When the company failed to pay the amount, officials of the GRA took inventory of all the company’s assets, including its office buildings, cold stores and two vehicles, a Nissan Sunny, with registration number GN 1762-12, and a Honda Accord, with registration number GE 1488 Z, before closing the company down.
According to officials of the GRA, the company had been issued several demand notices to settle its debts but to no avail.
But, speaking with the media, Mr Muzzammil said at the time the debt was incurred, a different management was in charge of the company.
He said the company would investigate how that a flaw occurred and even ask for a re-audit to establish the veracity of the claims of the GRA.
“If it is a flaw from our side, I am sure as a commitment to the nation we will put in all efforts to pay back to the government within the stipulated time,” he said.
“We will have to get a clear understanding as to why this amount has accrued. It is something pertaining to 2006/2007 at the time when most of us here were not here. We have to go back to our archives and records and try and understand what has been paid to the government and what is liable to us,” he added.
He said while that was not the first time the company had been notified about its tax obligations, the last time the management received notification was 2008, adding that that was an issue which concerned almost all fishing companies in the country.
But sounding rather sceptical, he said, “I don’t know why this is cropping up again; I believe that at that time it was settled. We have to check transaction by transaction because this is not a small amount. We have to get to the bottom of it. From our side, it is our duty to pay, but at the same time it is a moral responsibility to know if we actually owe this amount.”
However, in a sharp rebuttal, a Principal Revenue Officer of the GRA, Mr Gershon K. Akpabli, giving a historical account of events leading to the present situation, said in 2008 the Revenue Protection Unit (RPU) of the erstwhile Revenue Agencies Governing Board received information that some fish importers and their agents had been engaged in fraudulent deals at the Tema Harbour from January 1, 2006 to December 31, 2007.
Subsequently, the complaints of malfeasance revealed that some fish importers forged trade documents covering their bills of lading, invoices and import declaration forms, changed port of landing from Mauritania and Guinea to Namibia and, in the process, obtained lower values from Gateway Services Limited, instead of BIVAC Ghana, which was the authorised inspection company for Mauritania and Guinea.
Those actions benefitted the companies involved because at that time fish was cheaper in Mauritania and expensive in Namibia.
To deal with the matter, the RPU hired the services of an international shipping consultant who tracked the movement of all the vessels that conveyed fish from Mauritania to Ghana from January 1, 2006 to December 31, 2007.
Mr Akpabli said after a careful analysis of the report submitted by the consultant, “the unit established that trade documents used by Unique Concerns Limited, among other fishing companies, in clearing some consignments of fish imports were falsified”.
In view of that, BIVAC Limited re-assessed all those transactions to reflect the true cost, insurance and freight values, revealing under payment in duties/taxes amounting to GHc1,956,021.
The GRA imposed a penalty of a 100 per cent, bringing the total customs duties/taxes to GH¢3,912,043.
He said the action to close down the company was a last resort and in conformity with sections 241 and 279 of the Customs Excise and Preventive (Management) Law 1993 (PNDCL 330) which mandates the commissioner general to attach the assets belonging to the company.
He said the GRA would auction all the company’s assets if it failed to pay all debts within 21 days.
He warned all importers who falsified custom declaration forms with the intention of reducing duties/taxes to stop the act, adding that the law would be ruthless with any person caught by the law.
Mr Akpabli said a number of companies were engaged in such falsification of custom declaration forms and stated that the GRA would stop at nothing to retrieve amounts owed the country.
Tax avoidance schemes marketed by the financial sector have also proven an irritant, and been countered by complicated anti-avoidance legislation.
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