SCANCOM PLC v. THE COMMISSIONER - GENERAL GHANA REVENUE AUTHORITY

Appellant is dissatisfied with the Tax Objection decision of the Respondent dated 9th September 2021 and has appealed against the said decision to the High Court.

The grounds of appeal are as follows:

The Respondent erred in law and acted arbitrarily by imposing Value Added Tax liability on the Appellant for Imported Services for the period January 2014 to December 2017, when

(i) The Value Added Tax Act, 2013 (Act 870) does not impose Value Added Taxes on Imported Services which are used to make Taxable Supplies;

(ii) The Appellant had used the Imported Services for that period solely for its Telecommunication business (taxable supplies); and

(iii) Even if Respondent had identified that some of the Imported Services had been used for the Appellant's Mobile Money business (Exempt Supplies), the Value Added Tax, 2013 (Act 870) does not authorise the imposition of an arbitrary Value Added Tax liability based on the proportion of the total revenue of the Taxpayer generated from the Exempt supplies.

That Respondent erred in law by relying on a Ghana Revenue Authority's Internal Practice Notes/Guidelines to impose National Health Insurance Levy and Ghana Education Tax Fund Levy (together with interest and penalties) on the Appellant for Imported services provided by Non-Resident entities, when

(i) The relevant statutes do not sanction the imposition of those levies on Imported Services utilised to make Taxable Supplies;

(ii) The Appellant did utilise the Imported Services to make Taxable Supplies;

(iii) It is unlawful for Ghana Revenue Authority to amend a statutory position through Practice Notes; and

(iv) Ghana Revenue Authority's Practice Notes/Guidelines are binding on Ghana Revenue Authority only, and not on Taxpayers.

According to Statement of Facts, Appellant is a Ghana incorporated company operating through its brand name; MTN Ghana. Before 2018, Appellant had telecommunication and mobile money as its two main streams of business.

That whilst the telecommunication business involves telephony, data communication and associated services; the mobile money business involves the provision of financial technology that allows people to receive, store and spend money using mobile devices.

That Appellant kept consolidated books and records and prepared financial statements for both streams of businesses.

Since 2018, a new and separate legal entity known as Mobile Money Limited took over the mobile money business, leaving the Appellant to focus on on