Monday, May 5, 2008

Politicians urged to pay taxes on funds raised

Page 19 May 3/2008

Story: Charles Benoni Okine

THE Internal Revenue Service (IRS) has asked politicians who conduct activities to raise funds to support their political campaigns to make full declaration of what they receive and pay the appropriate taxes to avoid punishment.
It said revenue from such fund-raising events, either in the form of cash or property, directly fell under the Gift Tax and noted that failure to declare such revenue amounted to the gross violation of the country’s tax laws, which was punishable by law.
Sub-section ‘D’ of the Gift Tax Law states that a person who receives a taxable gift should, within 30 days of receipt of the gift, furnish the tax office with a return in writing containing the description and location of the taxable gift, its total value, the full name and address of the donor and any other information required by the tax office.
The call comes in the wake of a number of fund-raising activities being conducted by some parliamentary aspirants in different parts of the country.
The Assistant Commissioner in charge of training at the IRS, Mr W.C. Sefah-Agyebeng, made the call when he answered questions from Daily Graphic in Accra as to whether politicians who raised money to support their individual political activities were constitutionally mandated to declare what they got during such functions and pay the appropriate taxes to the state.
“Whatever they raise at such functions or from any activity, once it does not go into the coffers of the party on whose ticket they are standing but is handled by themselves, they have to declare it so that they can be taxed accordingly,” he said.
Mr Sefah-Agyebeng stated that it would amount to a clear violation of the tax laws should any politician refuse to file his or her tax returns, particularly on activities such as fund-raising.
He could not immediately tell how many politicians had filed their tax returns with the service but noted that there were many out there who were reluctant to do so.
A source within the service revealed to the Daily Graphic that many of the politicians who sought parliamentary seats on the tickets of their parties seldom filed their tax returns, compared to those who run for the Presidency.
It noted that although some openly announced their fund-raising activities, the service was largely reluctant to pursue such politicians on many occasions for what it termed "obvious reasons".
Mr Sefah-Agyebeng was illusive on why the IRS did not pursue such politicians who openly announced their fund-raising activities but reiterated that such offenders, when identified, would not be spared “because the tax laws are explicit and do not discriminate”.
He explained that individual politicians who were raising funds from supporters and sympathisers for their own campaigns, without accounting to their political parties, were classified under the Gift Tax and urged them to be alive to their responsibilities.

No comments: