RICHARD AMO-HENE V GHANA REVENUE AUTHORITY, ATTORNEY-GENERAL, JUDICIAL SERVICE  

Citation: Unreported Judgement of the Supreme Court (Civil Appeal No. J1/08/2021) dated 30th November 2022

Digital Citation:  [2022] GHASC 103

Brief Facts:
The applicant, Richard Amo-Hene, initiated legal proceedings against the Ghana Revenue Authority, the Attorney-General, and the Judicial Service, seeking reliefs related to the constitutionality of the legality of certain tax provisions which requires taxpayers to make upfront payments of a portion of disputed taxes before their appeals can be heard.

Grounds of Application
The applicant invoked the original jurisdiction of the Supreme Court, to declare as unconstitutional, Section 42(5)(b) of the Revenue Administration Act, 2016 (Act 915, as amended), which mandates a taxpayer to pay 30% of all outstanding taxes before objecting to a tax decision, and Order 54 rule 4(1) of the High Court (Civil Procedure) Rules, 2004 (C.I. 47), which requires a taxpayer to pay at least 25% of the disputed tax amount before an appeal can be entertained.

Issues

  1. Whether or not the plaintiff properly invoked the original jurisdiction of the Supreme Court?
  2. Whether or not Section 42(5)(b) of Act 915 is inconsistent with the spirit and letter of the 1992 Constitution, and the extent of such inconsistency?
  3. Whether or not Order 54 rule 4(1) of C.I. 47 is inconsistent with the spirit and letter of the 1992 Constitution and the extent of such inconsistency?

Areas of Tax Law Considered

  1. Tax Administration
  2. Dispute resolution mechanisms in taxation
  3. Constitutional rights relating to access to justice

Arguments

 Applicant (Taxpayer)

  1. Demanding upfront tax payments as a prerequisite for challenging assessments violates the presumption of innocence and hinders access to justice.
  2. He likened the situation to denying citizens access to other fundamental rights based on financial qualifications, arguing it goes against the spirit of the Constitution.
  3. Comparative jurisprudence from other common law countries points to a holistic assessment of the taxpayers obligations including considerations of human rights.

Defendants

  1. The defendants argued that the plaintiff improperly invoked the original jurisdiction of the Supreme Court, as the matter concerned the interpretation and enforcement of the Constitution.
  2. They defended the impugned provisions, stating that they balance the taxpayer’s rights with the need for efficient tax collection.
  3. They argued that the upfront payment requirement prevents frivolous objections and encourages timely payment of taxes, serving the public interest.
  4. They also pointed to the discretionary power of the Commissioner-General to waive or vary the upfront payment requirement, further mitigating any potential hardship.

Ruling
The Supreme Court, in a majority decision, dismissed the plaintiff’s action and upheld the constitutionality of Section 42(5)(b) of Act 915, finding it consistent with Article 23 of the 1992 Constitution, which guarantees administrative justice.

Reasoning

  1. The Court has already interpretated these provisions and determined that it does not create a fetter on the right to challenge tax decisions.
  2. The Court upheld the constitutionality of Order 54 rule 4(1) of C.I. 47, reasoning that it aims to ensure efficient tax collection and prevent abuse of the appeals process.
  3. There are safeguards within the legislation, which allow for waivers and variations of upfront payment requirements in appropriate cases.

Principles for Tax Practitioners
The case affirms the prerogative to balance efficient tax collection with taxpayers’ right of access to justice. While the majority upheld the constitutionality of upfront payment requirements, the dissenting opinion highlights the potential for injustice and underscores the need for careful judicial scrutiny of such provisions.
The decision also emphasises the importance of proportionality and the availability of safeguards, such as discretionary waivers, to mitigate any undue hardship on taxpayers.

References

Constitutional

  • Articles 23, 125, 157, and 296 Articles 23, 125, 157, and 296

Statutory references

  • Evidence Act, 1975 (NRCD 323)
  • Income Tax Act, 2015 (Act 896)
  • State Policy on Revenue Mobilisation (2023)
  • Revenue Administration Act, 2016 (Act 915)

Procedural Rules

  • Section 54 (4)(1) of the High Court (Civil Procedure) Rules, 2004 (C.I. 47)

Case Law

  • Belersdorf Ghana LTD v The Commissioner General, Ghana Revenue Authority [HJ1/140/2019 (unreported) 5th December 2019]
  • Capstone 556 (Pty) Ltd v Commissioner, South Africa Revenue Service ZASCA 2
  • Export Finance Company Limited v Ghana Revenue Authority [SC 30th November 2022 Unreported]
  • Fuelex Ltd v Uganda Revenue Authority UGCC 10
  • Kwasi Afrifa v Ghana Revenue Authority & Another [SC 30th November 2022 Unreported]
  • Metcash Trading Ltd v South African Revenue Service 11 WLK 764