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(1) At the end of the accounting period provided in this Act or prescribed by regulations, a taxable person may deduct from the output tax due for the period, tax on goods and services purchased in Ghana or goods and services imported by him and used wholly, exclusively and necessarily in the course of his business, subject to the follow considerations-

(a) the supply is a taxable supply;

(b) in respect of purchases made in Ghana, the taxable person is in possession of a tax invoice issued under this Act;

(c) in respect of importation or removal of goods from bonded warehouse, the taxable person is in possession of the relevant customs entries indicating that the tax was paid.

(2) The tax deducted from the output tax under subsection (1) shall be known as deductible input tax.

(3) Unless otherwise provided in this Act, no input tax deduction shall be made on purchases or imports in respect of exempt supplies by the taxable person.

(4) No input tax deduction shall be taken more than once nor shall it be taken after the expiration of a period of three years from the date the deduction accrued.

(5) A taxable person does not qualify for input tax deduction in respect of taxable supply or import of motor vehicles or vehicle spare parts unless the taxable person is in the business of dealing in or hiring of motor vehicles or selling vehicle spare parts; provided that motor vehicles and spare parts used wholly, exclusively and necessarily for the business shall qualify for input tax deduction.

(6) A taxable person does not qualify for input tax deduction in respect of taxable supply in respect of entertainment including restaurant, meals and hotel expenses unless the taxable person is in the business of providing entertainment.

(7) Where a taxable supply to, or an import of goods by, a taxable person is partly for business use and partly for personal or other use, the amount of input tax allowed as a credit shall be restricted to that part of the supply that relates to the business use.

(8) If goods for which a credit has been allowed under this Act cease to be applied to taxable transactions before the end of their life, the goods shall be treated as sold at the time of the cessation for the open market value.

(9) In the case of a taxable person who regularly resells used goods purchased from consumers, the Commissioner may determine the procedures for allowing such person input tax credit.

(10) The Minister may by legislative instrument prescribe other classes, types or description of goods and services on which input tax is non-deductible.