The government has retrieved about GH¢400 million from inappropriate transfers that multinational companies effected last year, a practice known as transfer pricing.
On December 31, 2018 alone, one of the companies paid $10 million (about GH¢50 million) which it admitted was transferred out of the country inappropriately, the Commissioner General of the Ghana Revenue Authority (GRA), Mr Emmanuel Kofi Nti, has revealed.
Transfer pricing occurs most often when multinational companies sell goods to divisions in other international jurisdictions. The system is laden with abuse because companies can deliberately pay higher prices for items or intermediary products they purchase from overseas-related parties.
When this happens, it increases the expenses of the local entities resulting in lower statutory payments such as taxes.