The Internal Revenue Commission (IRC) will no longer allow companies’ salary and wages tax to be offset with GST credits.
Acting Commissioner General, Sam Koim, said this provision has been abused and they will not allow it any further.
Koim said this when announcing that the IRC had identified a pattern of employers’ diverting salary and wages tax to other operational expenses.
“In the past, taxpayers have been allowed to use GST credits to offset their salaries and wages taxes pursuant to Section 91(5) of the Goods and Services Act 2003.
“That provision grants the Commissioner General discretion to allow such to happen, but this has been abused. Hence it is my considered position that from this day on, I will not allow any salaries and wages taxes to be offset with GST Credits,” said Koim.
“It has produced impunity for theft instead of genuine compliance.
“Those who steal salary and wages tax off their employee taxes to fund their operations will not seek cover under such provisions.”