URA: Let’s try to appreciate what tax a business person down town actually pays and what he doesn’t pay.
1. VAT is paid by you the final consumer. It is simply collected by the business person on behalf of URA from you and then remitted. Some businesses have not been remitting it after collecting it.
2. Withholding tax is paid by suppliers to that business person. It is withheld by the business person at the point of paying a supplier. Again, some business persons have been withholding it and not remitting it. They just eat it!!
3. Rental tax is paid by the landlord. Not the business operator. The business operator pays rent to the landlord. This rent is an allowable expense when computing income tax.
4. Trading license is also a cost to the business man to run his business. Business costs are deducted by the businessman when computing his income tax. He gets to remove all allowable expenses from the income earned in a year to arrive at chargeable income.
5. Income Tax is the tax that is payable by the business person and it is arrived at where a profit has been made. Where a business is in a loss position, even this income tax is not expected to be paid but the business person has the duty to file a return to URA indicating that business reality.
6. That is where EFRIS – a smart book keeping solution can even come in to aid the said business to keep track of its business records.
Therefore, EFRIS is not a problem to a compliant business person. It is however, a problem for a non-compliant business person because the non-compliance becomes detectable.