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 VAT is a good tax ?
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toubab1020



9020 Posts

Posted - 11 Jan 2013 :  21:22:59  Show Profile Send toubab1020 a Private Message  Reply with Quote
As I understand it VAT will be levied on companies with a turnover of 1 Million Dalasi or over,although there are some exceptions,but in general, can you honestly see large companies such as those envisaged swallowing a vast increase in taxation that they would have to pay to the government? Such companies will just pass the tax onto the smaller companies or customers who they serve, result the general population of Gambia would pay more for almost anything,hardly a sensible course of action for a developing nation who has very limited money.

You cannot expect the average Gambian with a small shop or enterprise to understand "input tax claimable monthly" and even if he did,I suspect that the GRA may well be overloaded and unable to process claims payable swiftly.Bearing in mind that frequently hospital staff and teachers experience delays in their monthly salaries.
Gambia is in no way ready to implement such a draconian tax.





http://www.foroyaa.gm/index.php/burning-issues/12185-gra-holds-press-conference-on-vat

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 11 Jan 2013 21:29:40

Momodou



Denmark
8618 Posts

Posted - 12 Jan 2013 :  00:39:33  Show Profile Send Momodou a Private Message  Reply with Quote
I have been informed that the price of a bag of rice has already been increased. Matches have been increased from 1D to 1.5D. Of course it is the consumers who will pay.

A clear concience fears no accusation - proverb from Sierra Leone
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toubab1020



9020 Posts

Posted - 12 Jan 2013 :  00:54:34  Show Profile Send toubab1020 a Private Message  Reply with Quote
That is the kind of stance the big boys will take, cannot pay taxes and not get them back from the smaller consumers and in doing so fuel inflation and additional hardship.
Momodou,as I understand it rice is free of import duty and as a food I would have assumed free of VAT so here is the first flaw in the "good tax " plan beloved by some politicians.
Perhaps you can locate the speech that I read recently about "good tax" probably in the D.O. and supply a link ? or perhaps KOBO can !


quote:
Originally posted by Momodou

I have been informed that the price of a bag of rice has already been increased. Matches have been increased from 1D to 1.5D. Of course it is the consumers who will pay.


"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 12 Jan 2013 00:58:35
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Momodou



Denmark
8618 Posts

Posted - 13 Jan 2013 :  21:58:37  Show Profile Send Momodou a Private Message  Reply with Quote
There is no "good tax" link.

A clear concience fears no accusation - proverb from Sierra Leone
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toubab1020



9020 Posts

Posted - 13 Jan 2013 :  22:39:03  Show Profile Send toubab1020 a Private Message  Reply with Quote

Its all about shuffling figures around,one thing is for certain the average Gambian will have to pay more !!


"However,Kolley said that there is a need to realign certain tax items in the switchover so as not to increase the cost of necessities. For example, rice, which used to be duty free with a sales tax of 5% would now become zero-rated under VAT and would attract an import duty of 5%; and sugar, flour and cooking oil, which attract a 5% duty and 15% sales tax, would be zero-rated under VAT and attract 20% duty."

http://www.tax-news.com/news/Gambia_Budget_Simplifies_Tax_for_SMEs____58875.html





quote:
Originally posted by toubab1020

That is the kind of stance the big boys will take, cannot pay taxes and not get them back from the smaller consumers and in doing so fuel inflation and additional hardship.
Momodou,as I understand it rice is free of import duty and as a food I would have assumed free of VAT so here is the first flaw in the "good tax " plan beloved by some politicians.
Perhaps you can locate the speech that I read recently about "good tax" probably in the D.O. and supply a link ? or perhaps KOBO can !


quote:
Originally posted by Momodou

I have been informed that the price of a bag of rice has already been increased. Matches have been increased from 1D to 1.5D. Of course it is the consumers who will pay.




"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 13 Jan 2013 22:44:22
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toubab1020



9020 Posts

Posted - 13 Jan 2013 :  22:41:18  Show Profile Send toubab1020 a Private Message  Reply with Quote


Thanks for searching Momodou, a memory error perhaps or more likely a bad choice of words


quote:
Originally posted by Momodou

There is no "good tax" link.


"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.
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Momodou



Denmark
8618 Posts

Posted - 15 Jan 2013 :  22:17:46  Show Profile Send Momodou a Private Message  Reply with Quote
CONFUSION ABOUT VALUE ADDED TAX (VAT)


Foroyaa Editorial: Published on Tuesday, 15 January 2013


The consumers are complaining about price hikes attributed to VAT but the GRA has made it clear that VAT is not designed to increase prices. Some readers have said that what they have gathered from the Public media is that only those who have businesses with turnover of one Million dalasi are obliged to register to collect value added tax and those who have a turnover of 500,000 dalasi could do so voluntarily.

Foroyaa sees the need to review the tax laws piecemeal so that the readers would have a clear understanding of tax obligations and exemptions. We hope the GRA will follow our coverage with keenness and step in to clarify any point deemed necessary.

The state attempted to simplify the taxation system by enacting the Income Tax and Value Added Tax Act 2012. The Act establishes five different forms of taxation, namely, Income Tax, Capital Gains Tax, Residential Rent Tax, Fringe Benefits Tax and Value Added Tax.

Income tax is imposed each year for a person who has chargeable income for a year. Any person who earns 7501 dalasi per annum or more is obliged to pay income tax unless one is exempted.

Chargeable income is any profit or gain derived from business activity, employment income, property income other than rent or any other income derived by a person during the year that is not exempted from income tax. This is added to give a total income from which all deductions allowed for tax purposes are subtracted to give the gross income of the person which is the taxable income.

There is income tax for individuals, trusts, partnerships and companies.

All tax payers shall acquire an income tax return which is a prescribed form to be filled and returned to the Commissioner General before 31st March of each financial year for review and validation of what one's chargeable income is.

We will interview the tax authorities to indicate to our readers how much tax to pay if you earn between 7501 dalasi which is less than one dollar a day and 17, 500, between 17, 501 and 27, 500; between 27, 501 and 37, 500, between 37, 501 and 47, 500 and finally any sum above 47, 500. This will enable the readers to compute their own tax obligations before being assessed and save the money so as not to default in tax payment. We hope former employees of the Tax establishment would also establish offices to help tax payers to process their returns with speed and accuracy for a fee.

Foroyaa will give free advertisement for the pioneers of such an enterprise. Follow the analysis in subsequent issues.

Source: Foroyaa

A clear concience fears no accusation - proverb from Sierra Leone
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toubab1020



9020 Posts

Posted - 16 Jan 2013 :  00:40:13  Show Profile Send toubab1020 a Private Message  Reply with Quote
"Nothing is more certain except death and taxes"

http://www.thisdayinquotes.com/2010/11/nothing-is-certain-except-death-and.html

Clarification is needed so people KNOW what they should pay.

"We will interview the tax authorities to indicate to our readers how much tax to pay if you earn between 7501 dalasi which is less than one dollar a day and 17, 500, between 17, 501 and 27, 500; between 27, 501 and 37, 500, between 37, 501 and 47, 500 and finally any sum above 47, 500. This will enable the readers to compute their own tax obligations before being assessed and save the money so as not to default in tax payment. We hope former employees of the Tax establishment would also establish offices to help tax payers to process their returns with speed and accuracy for a fee.!

http://www.foroyaa.gm/index.php/editorial/12210-confusion-about-value-added-tax-vat

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 16 Jan 2013 00:41:50
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toubab1020



9020 Posts

Posted - 16 Jan 2013 :  13:22:39  Show Profile Send toubab1020 a Private Message  Reply with Quote
" Naffie Barry, the permanent secretary at the Ministry of Trade , Regional Integration and Employment, stressed that VAT is not intended to create unfavourable business atmosphere in the country, adding that government is not here to levy any punishment on the people"


A glimmer of hope that modifications MAY be made


"She told the private sector representatives that development issues should be concern for everyone, adding that government is ready and willing to dialogue."


http://observer.gm/africa/gambia/article/gcci-stakeholders-discuss-commodity-price-hike

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.
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toubab1020



9020 Posts

Posted - 16 Jan 2013 :  13:59:05  Show Profile Send toubab1020 a Private Message  Reply with Quote
Here is something that I did not realise



"Please note VAT is now charged on
goods imported into The Gambia)
including Agricultural machinery."

Tractors for community use used to be tax free !

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.
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Momodou



Denmark
8618 Posts

Posted - 17 Jan 2013 :  21:01:58  Show Profile Send Momodou a Private Message  Reply with Quote
STAKEHOLDERS HOLD AWARENESS FORUM ON IMPLEMENTATION OF THE VAT

by Abdoulie G. Dibba

Foroyaa: Published on Thursday, 17 January 2013



The Gambia Chamber of Commerce and Industry (GCCI) in collaboration with the Ministry of Trade, Industry, Regional Integration and Employment (MOTIE) on Tuesday, 15th January, 2013 held a sensitisation forum at the GCCI Secretariat, Kerr Jula, at Bijilo in a bid to create more awareness on the implementation of the Value Added Tax (VAT).

In her statement, Madam Naffie Barry, the Permanent Secretary of MOTIE said her ministry is being tasked with following up the implementation of the recommendations of the National Economic Summit held on January 8, 2013. She expressed the concern of her ministry over the recent increases in the prices of essential commodities particularly food stuff as a result of the introduction of the VAT which prompted this interface between the public, the private sector and her ministry.

PS Barry said VAT is not intended to create an unfavourable business atmosphere in the country, adding that the Government will not punish the people by levying taxes on them twice. She explained that VAT is not another tax in addition to the then sales tax but a replacement.

She noted that the developmental issues should be the concern of everyone but that she said not all private sector operators are presence in this importance forum.

For his part, the Chief Executive Officer of the Gambia Chamber of Commerce and Industry Almamy Fanding Taal noted that all taxes levied on goods including and VAT are borne by the consumers. He expressed concern as to whether VAT will not reduced the purchasing power of the consumers.

Regarding the increases in prices, Mr Taal noted that tax is not the only factor that determines the increase in price but also the exchange rate of the trading currencies which have appreciated against the Dalasi.

Mr. Yankuba Darboe, the Acting Commissioner General of the Gambia Revenue Authority (GRA) reiterated that VAT is not an additional tax but instead a replacement of the previous Sales and Excise Tax.

He said the introduction of VAT should not lead to a general increase in the prices of goods and Services. "VAT replaces sales tax at the same rate of 15% and that the general price increases cannot be justified as most of the goods now subject to VAT were previously subject to sales tax at the same rate", said Mr. Darboe.

The GRA Acting Commissioner General noted that VAT should only be charged by businesses registered and issued with a VAT registration certificate by the GRA and that the registration certificate must be prominently displayed at the business premises.

He emphasised that customers should ensure that businesses without a VAT certificate do not charge them VAT.

"Businesses that earned over D1,000,000(One million Dalasi) are required by law to register and those who earned D500,000(Five hundred thousand Dalasi) registration is optional", he said.

In his remark, Mr. Ensa Jallow, the Commissioner of Domestic Tax at GRA, said VAT is not an additional cost for registered businesses as they are not liable to sales tax payment, adding that they are entitled to an input tax credit for the VAT paid on their purchases, imports and operating expenses. "The input tax credit is claimable monthly during the time of tax returns processing", he said.

He also stressed that businesses that are not registered for VAT are not required by law to charge VAT on their supplies of goods and services.

"Registered businesses are required to issue VAT invoices every time there is a sale of goods and services to VAT registered businesses. If that is not provided, customers should ask for their invoices. The VAT invoices must clearly state the amount of VAT that has been included in the total sales price and the VAT registration number", said Commissioner of Domestic Tax.

Source: Foroyaa

A clear concience fears no accusation - proverb from Sierra Leone
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toubab1020



9020 Posts

Posted - 17 Jan 2013 :  21:30:52  Show Profile Send toubab1020 a Private Message  Reply with Quote
There is nothing new that has been told to those who attended the awareness forum,no clarification of anything just a reiteration of the previously available information,I think that EVERYONE within the government departments concerned should get together and establish a much clearer explanation as to what is being charge to who and for what,it is inconceivable that VAT will work in a satisfactory way in Gambia, until the people tasked with dealing with VAT within the Government get their act together and UNDERSTAND what they are doing

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.
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toubab1020



9020 Posts

Posted - 17 Jan 2013 :  21:36:22  Show Profile Send toubab1020 a Private Message  Reply with Quote
The Point is also confused,and underlines the statement and observation:


" It is rather unfortunate that less than three weeks after the introduction of the Value Added Tax (VAT) by the Gambia Revenue Authority (GRA), the prices of basic commodities have been increasing exorbitantly.
This is unacceptable, and needs urgent redress from the GRA. If people find it difficult to buy food for their families as a result of the undue price rise, this could be very serious."


http://thepoint.gm/africa/gambia/article/about-the-vat

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.
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kobo



United Kingdom
7765 Posts

Posted - 10 Mar 2013 :  11:05:48  Show Profile Send kobo a Private Message  Reply with Quote
In The Gambia, The Value Added Tax Continues To Wreak Havoc
by Sidi Sanneh


Maafanta.com News: Published on Friday, 08 March 2013

"I am revisiting this topic sooner than expected because of the number of queries I have been receiving from Gambian businessmen and public servants about the implementation of the VAT. Their observations confirm my initial take: that the VAT was ill-prepared, and its introduction, rushed.

Given the complexity and novelty of this form of indirect taxation that demands meticulous record keeping among other requirements - not to mention the element of self-policing that this form of taxation requires - the authorities, including ECOWAS, are expecting more than the smallest economy in the sub-region, and perhaps in Africa, can deliver.

The state of preparedness varies from one business establishment to another. Some points of sales have not up-graded their systems to capture the 15% VAT, and those that have, have received different interpretations depending on which GRA official, the experts, they spoke to. Businesses exempted from the new tax regime are increasing their prices - consciously or out of ignorance - either way, the consumer is shafted as a result, in an economy that has been struggling for over a decade. The cascading effect is being felt all the way to the level of the market woman selling her tomatoes and fish at the Serrekunda market. Everybody seemed to have joined the fray, causing confusion, price gouging and other unsavory behavior. As I noted a couple of weeks ago, some businesses have already fled and others on the verge of fleeing Jammeh's country. This is not the way it's supposed to work.

ECOWAS should not be absolved of blame either. In its attempt to bring Member States to harmonize their trade policies - the core element of its regional integration program - the organization must take account of the different levels of economic development, size of economies and administrative capacities. The Gambia is among the last of the membership to embrace the new system, and I am happy that they did hold out this long. I wish they had prolonged the stay of execution (no pun intended) until further notice.

In Nigeria for example, the introduction of the VAT [at a rate of 5% compared to Gambia's 15%] was proceeded by a revision of the income tax downward to absorb the impending shock inherent in VAT. I have not seen any revision of the income tax rates downward in this case. Gambians are still one of the highest taxed people in the world.

My reservation has as much to do with WTO, and the raw deal African countries get from the organization, as to my concern about the tax burden and its effect on the poor and struggling population. An elite class that has perfected tax dodging into a fine art, adding a new item to the menu further whets the appetite of the unscrupulous operator and the corrupt government tax collector to take advantage of the system. Costs associated with these practices will be passed on to consumers in the form of higher prices. I am afraid ordinary Gambians will end up being shafted once more with this VAT thing.

BIVAC killed the re-export trade. VAT will drive businesses to seek refuge in Senegal and neighboring countries. "

Edited by - kobo on 10 Mar 2013 11:06:24
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toubab1020



9020 Posts

Posted - 15 Apr 2013 :  19:53:43  Show Profile Send toubab1020 a Private Message  Reply with Quote
So, VAT has caused extra inflation,well there is a surprise not really !

"Despite the argument of the GRA, prices continue to escalate unabated. But to cushion the situation, the Central Bank of The Gambia “has however tightened its targets for reserve and broad money growth to stem potential inflationary pressures and stabilize the dalasi”, which, the IMF mission notes, has continued to weaken against most major currencies.”


http://thepoint.gm/africa/gambia/article/vat-aggravates-inflation


VAT aggravates inflation
africa » gambia
Monday, April 15, 2013

Inflation in The Gambia has gone up steeply in the last three months, especially since the Value Added Tax (VAT) was introduced in The Gambia in the wake of 2013, says the International Monetary Fund (IMF).

This was affirmed by a statement a one-week mission of the IMF read to journalists at a press conference held recently at the Central Bank of The Gambia in Banjul.

The statement says: “Inflation, however, has picked up, partly due to side effects from the introduction of the value-added tax (VAT) at the beginning of the year. For example, although the VAT is applied to firms with a turnover of at least one million dalasis, we understand that many smaller businesses also raised their prices opportunistically.”

The implementation of Value Added Tax in The Gambia is part of the tax reforms embarked upon by The Gambia’s Public Financial Management Reforms and ECOWAS Member States.

But since its implementation in the country in January this year, prices of goods and services have increased rapidly, even though the nation is made to believe that “the VAT has no cascading effect” and “is good for the promotion of both domestic and international competitiveness”.

The Gambia Revenue Authority (GRA), the institution implementing the VAT, has said the introduction of VAT should not lead to a general increase in the prices of goods and services, but the contrary is what the nation has been experiencing in the last three months.

A press release by the GRA argues: “VAT replaces sales tax at the same rate of 15%. The general price increases cannot be justified as most of the goods now subject to VAT were previously subject to sales tax at the same rate.

“VAT should only be charged by businesses registered and issued with a VAT registration certificate by the GRA. The registration certificate must be prominently displayed at the business premises. Customers should ensure that businesses without a VAT certificate do not charge them VAT.

“VAT is not an additional cost for registered businesses, as they are not liable to sales tax payment, and are entitled to an input tax credit for the VAT paid on their purchases, imports and operating expenses. The input tax credit is claimable monthly during the time of tax returns processing.

“Businesses not registered for VAT are not required by law (income & Value Added Tax Act 2012) to charge VAT on their supplies of goods and services.

“Registered businesses are required to issue VAT invoices every time there is a sale of goods and services to VAT registered businesses. If not provided, customers should ask for their invoices. The VAT invoices must clearly state the amount of VAT that has been included in the total sale price and the VAT registration number.

“Registered retail businesses are required to issue VAT receipt every time there is a sale of goods to VAT customers. If not provided, customers should ask for their receipt if needed. The VAT receipts must clearly state the amount of VAT that has been included in the total sale price and the VAT registration number.

“All prices of goods and services displayed and quoted by VAT registered businesses must be VAT-inclusive. VAT should not be an additional charge added to the advertised price nor should the payment of VAT be negotiated over the counter by the customer and sales agent.

“Basic foods like rice, sugar, oil, flour, basic bread, fresh fish, fresh meat, fresh vegetables, maize, sorghum, millet, fruit and infant food, etc. are exempted from VAT. No business should charge VAT on these goods hence no price increases are expected.”

Despite the argument of the GRA, prices continue to escalate unabated. But to cushion the situation, the Central Bank of The Gambia “has however tightened its targets for reserve and broad money growth to stem potential inflationary pressures and stabilize the dalasi”, which, the IMF mission notes, has continued to weaken against most major currencies.”
Author: Osman Kargbo

"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 15 Apr 2013 19:59:13
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toubab1020



9020 Posts

Posted - 15 Apr 2013 :  21:20:19  Show Profile Send toubab1020 a Private Message  Reply with Quote
Must be even handed, The D.O.puts a slightly different slant on what the IMF reported.
This was included in the D.O. piece and I totally agree with this:
"we must not forget the repeated calls for attitudinal change. In other words, we want to see Gambians become active participants in shaping their destiny. If we change our attitude for the good and merge our efforts towards the common good, our chances of success will be greater."

http://observer.gm/africa/gambia/article/another-thumbs-up-for-the-economy-1

Another thumbs-up for the economy
Africa » Gambia
Friday, April 12, 2013

Editorial

The IMF continues to commend The Gambia to for its prudent policies regarding diverse sectors of engagement, especially in the economic sector. Such a frank remark on the state of our economy from a senior figure of the IMF testifies that the pace of development in The Gambia is encouraging.

After all, the survival of any nation, it is widely argued, depends on its economy because the community of economic life is the major feature within a nation. Hence, the success of the leadership of any sovereign nation to a great extent could be measured by the success of its economic policies.

The remark of the top IMF official is of course not a surprise, as it is evident that this country has maintained stable economic growth, with the economy rapidly improving alongside the creation of more employment opportunities.

However, what is fundamental is that while we rejoice over continuous recognition and acknowledgement of our achievements in all spheres of national development, we must not forget the repeated calls for attitudinal change. In other words, we want to see Gambians become active participants in shaping their destiny. If we change our attitude for the good and merge our efforts towards the common good, our chances of success will be greater.

Besides, development is for the citizens. We should therefore become active participants and take centre-stage in our economic development process. Nobody will come and develop our country for us; they can only drain the little that we have.
Author: Daily Observer



"Simple is good" & I strongly dislike politics. You cannot defend the indefensible.

Edited by - toubab1020 on 15 Apr 2013 21:22:21
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