C5-Indirect Taxes

C5-INDIRECT TAXES

This Paper introduces students to indirect taxation and covers aspects of Value Added Tax and Customs and Excise Duties and surtaxes.

Objectives

A candidate who has successfully completed the subject should be able to:

1. Discuss the history and growth of Value-added taxes globally and the rationale for their adoption by governments internationally;
2. Describe the ‘invoice based, credit offset, value-added tax’ model and the concept of ‘neutrality’ as that term is used in the VAT Act;
3. Discuss the activities and transactions that represent practical difficulties in the operation of the ‘invoice based, credit offset, value-added tax’ model and describe the structural design features that lead to these difficulties;
4. Give reasons why governments choose to exempt, zero-rate and treat as out of scope certain activities under a credit offset, invoice-based VAT; and
5. Discuss the various issues pertaining to Customs and Excise Duties.

Structure of the examination paper

There shall be a three hour examination consisting of five (5) compulsory questions of twenty (20) marks each. Candidates will be allowed fifteen minutes’ reading and planning time.

Detailed Syllabus

• UNIT 1 - VALUE ADDED TAX

• Element 1: Meaning of Value Added tax
• Element 2: How the VAT system works & Legislation for VAT
• Element 3: Arguments for and against VAT
• Element 4: Meaning of Supply
• Element 5: Determination of Taxable supply
• Element 6: Meaning of Consideration
• Element 7: VAT Registration & Deregistration Rules
• Element 8: Output Tax Element 9: Input Tax
• Element 10: Link between VAT and direct taxes
• Element 11: Partial Exemption Methods
• Element 12: Imports and exports
• Element 13: Special Schemes
• Element 14: Special Retailer Methods
• Element 15: Chain Transactions – Minimum Taxable Values
• Element 16: Reverse Charge VAT
• Element 17: VAT Control and credibility checks
• Element 18: Principle of Estoppel in VAT Cases
• Element 19: Leasing Transactions & Repurchase Agreements
• Element 20: VAT on Printed & Other Matter
• Element 21: VAT Refund Scheme for Tourists
• Element 22: Bad Debt Relief
• Element 23: Self Supply
• Element 24: Transfer of Business as a Going Concern
• Element 25: Correction of Errors
• Element 26: Misdeclaration
• Element 27: Late Registration and unauthorized issue of VAT Invoices
• Element 28: VAT Penalties & Interest
• Element 29: Appeals & Requests for Review

• UNIT 2 – SPECIFIC SECTOR VALUE ADDED TAX

• Element 1: VAT Considerations in the Mining Sector
• Element 2: VAT Considerations in the Agriculture Sector
• Element 3: VAT Considerations in the Tourism Sector
• Element 4: VAT Considerations in the Telecommunications Sector
• Element 5: VAT Considerations in the Banking & Financial Services Sector
• Element 6: VAT Considerations in the Construction Industry

• UNIT 3 - CUSTOMS AND EXCISE DUTIES

• Element 1: Introduction to Customs & Excise Duties
• Element 2: Functions of the Customs and Excise Division
• Element 3: Powers of ZRA Officials
• Element 4: Official and Commercial Documents
• Element 5: Determination of value for Duty Purposes
• Element 6: Valuation Element 7: Clearance.
• Element 8: New Residents Rebates
• Element 9: The African Growth and Opportunity Act (AGOA)
• Element 10: International Trade Agreements
• Element 11: Preferential Trade Agreements
• Element 12: Exportation of Goods
• Element 13: Excise Duties
• Element 14: Bonded Warehouses
• Element 15: Currency Declaration
• Element 16: Surtax on Carbon Emissions
• Element 17: The COMESA Customs Union
• Element 18: Overlapping Membership of Regional Tax Groupings

• UNIT 3 - EXPORT CONCESSIONS

• Element 1: Introduction
• Element 2: Duty Drawback System
• Element 3: Basis of Payment
• Element 4: Challenges of the duty drawback system
• Element 5: Calculation of Coefficients for Duty Draw Back
• Element 6: Zero Rating for Exports