Ride-hailing drivers in Ghana are resisting a proposed vehicle income tax by the country's revenue authority, asserting that it would strain their earnings. The new tax notice, effective January 1, 2024, mandates commercial vehicle owners earning income to pay quarterly income tax. Ride-hailing companies like Uber, Bolt, and Yango must ensure driver compliance by verifying Vehicle Income Tax (VIT) payment before allowing them on platforms.
Ride-hailing drivers in Ghana are resisting a proposed vehicle income tax by the country's revenue authority, asserting that it would strain their earnings. The new tax notice, effective January 1, 2024, mandates commercial vehicle owners earning income to pay quarterly income tax. Ride-hailing companies like Uber, Bolt, and Yango must ensure driver compliance by verifying Vehicle Income Tax (VIT) payment before allowing them on platforms. Drivers argue the tax burden should fall on companies rather than individuals, considering existing commission structures.
Many drivers find the new tax surprising, having already dealt with ride-hailing commissions. They contend that adding another layer of tax exacerbates their challenges with fuel costs and vehicle maintenance. Ride-hailing giants Bolt and Uber charge 20%, while Yango reportedly takes 18%.
The GRA's breakdown designates ride-hailing vehicles as "Class A," subject to a quarterly payment of 12 Ghana Cedis, totaling 48 GHC annually. All commercial vehicle operators must purchase VIT stickers and affix them to the front windscreen. This tax imposition marks Ghana's recent effort to tax ride-hailing firms, following the introduction of the "Digital Transport Guidelines" levy in April.
Ghana's low tax-to-GDP ratio, 14.1% in 2021, compared to Africa's 2023 average of 15.6%, underscores the country's fiscal challenges. The government's persistent push for taxes on ride-hailing services, despite public criticism, raises concerns about its economic impact and citizen dissatisfaction.
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