2.0 Taxation Rulings in Perspective
The health of a nation's wealth in relation to the dynamics of its tax system portrays a lot about the country in terms of its designed fiscal policies anchoring within the tentacles of her defined macroeconomic limits. This defined limitation provides a holistic framework as to the institutional, structural and policy designs in place to maintain a well-balanced, coherent and sustainable economic growth and development. Putting this into practical terms, explains the importance of rulings and most importantly public rulings in the sphere of tax management for developing economies like The Gambia. Ideally, taxation rulings is a recipe that serves as a catalyst towards avoiding any form of inconsistency in interpretation and applications of certain or if not all the provisions within the confines of a country's tax laws (codes) in order to bridge a highly interpretative and codified applications on the certain provision of the tax laws (Act). What this implies is that taxation rulings generally provide the basis of clarity and consistency in the administration of certain provisions within the parameters of a country's tax laws. Basically, a ruling therefore, takes three multidimensional approaches which include inter-alia: (a) public ruling, (b) private ruling and (c) oral rulings, respectively. It is important to state here that our discussion will be limited to public and private rulings, citing The Gambia as a case study.
In The Gambia's context, a public ruling is an expression of the Commissioner General's opinion of the way in which a relevant provision applies, or would apply, to entities generally or to a class of entities, individual (taxpayers) and revenue officers, devised purposely in a form of guidance, thus setting out the Commissioner-General's interpretation of the application of the Act (IVATA: 2012: Part XI, s250 (1) Laws of Taxation). In a nutshell, public rulings are the opinion of the Commissioner General and are not a source of law. In this case, a public ruling is binding on the Commissioner General until revoked and are not binding on taxpayers (IVATA, 2012). What this implies is that a public ruling is not an expressed provision of the law itself but rather a marriage of convenience to create such platform of clarity and consistency in terms of avoiding deafening interpretation and application of certain definitive provisions within the laws of taxation in The Gambia. In consequent, the Commissioner General is legally bound to the view expressed in the ruling so long as the law to which it relates remains in force. However, the Commissioner General is required to publish the devised public ruling for usage and at the same vein can equally withdraw any publication of pubic rulings if he thinks it otherwise. This is referred to as the "rhythm of discretion" in taxation, where the head of a tax administration (the Commissioner General) is conferred with discretionary powers to make public rulings and at the same time withdraws the publication of his decision in any public rulings case.
A private ruling on the other hand, is an expression of the Commissioner General's opinion on how the tax law applies to a named taxpayer in relation to a specified scheme and cannot be taken as a precedent for someone else. although, taxpayers dissatisfied with the ruling can object to the Commissioner General's decision and have them reviewed by the Tax Tribunal and if still unsatisfied with the reviewable decisions of the former can still challenge it to other court of competent jurisdiction such as the Appeal and the Supreme Courts, respectively for due hearings. This is contingent upon meeting certain requirements as laid down by the provisions of the Income and Value Added Tax Act, 2012
Generally, people have differing views on the connotative meanings tax rulings as a result of their level of education, different orientations, beliefs, value systems and ways of understanding issues or policies in order to come to terms at the same wavelengths with definitive correctness for related interpretational base analysis. As indicated earlier, there is the most ardent need to publish the rulings of the Commissioner General on certain provisions that require clarity in interpretation and application to serve as temporary binding advice until revoked or prove otherwise from the Attorney General's office. In essence, it is believed that the simplification of certain unclear provisions in the forms of rulings enhances the promotion and development of the culture of voluntary self-regulated compliance and awareness in meeting tax obligations regarding payments and at the same time will even accommodate the unlettered taxpayers' to be cleared of their doubting intentions in cases of ambiguities in the tax laws. It is obvious that every intended consequence has an equal and opposite unintended consequence which has to deal with unnecessary complexity and uncertainty on the application laws, inconsistency with the policy the legislation was intended to implement and difficulties in compliance (Flint:2004)
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I am a professional tax practitioner of 15 years of government experience.