Businesses involved in importation at the country’s ports are demanding a significant reduction in taxes on imports in tandem with levels in neighbouring Ivory Coast and other members of ECOWAS.
The importers who are unhappy about the manner in which authorities at the Ghana Revenue Authority (GRA) have commenced the implementation of the new ECOWAS Regional Common External Tariff (CET) have warned of increased smuggling into the country due to the high tariffs at Ghana’s ports.
The new tariff has triggered major increasesin import duties on a wide range of goods.
According to the Executive Secretary of the Association of Importers and Exporters, Mr Sampson Asaki, Ivory Coast was able to negotiate downwards the 35 per cent tariff on tomato paste, cooking oil, frozen foods and mineral water to 20 per cent.
“Ivory Coast went back to the authorities at the CET and made a case for their businesses, saying they could not pay that tariff. They requested to be made to pay 20 instead of 35 per cent,” he said.
MrAsaki recalled that before the increases, Ghana was charging 20 per cent on those food items, representing a hike of 15 per cent.
He lamented profusely about the fact that Ghana continues to be the highest in the imposition of taxes on imports in the sub region (43 per cent) and warned that the smuggling of goods will continue if import taxes are not reduced.
Mr Asaki was perplexed over reasons why government would not seek the interest of Ghanaian businesses they way other countries are doing.
Apart from the general low level of taxes in countries like Ivory Coast, lending rates in that country stand at 3.8 per cent while that of Ghana is at 26 per cent, meaning. Inflation in Ivory Coast is 1.3 per cent against Ghana’s 17.7 per cent (as at December 2015)
Vehicle importers who in the past paid as low as 5 per cent levy will now pay 20 per cent import duty for all types of vehicles.
Importers of goods such as tomato paste, cooking oil, frozen foods and mineral water will attract a 35 per cent increase in import duty instead of the previous 20 percent. Rice importers will also attract 20 percent duty on all imports.
Some clearing agents whose businesses have gone down because of the many uncleared goods are also disturbed about the developments. Their bane has largely been the exchange rate fluctuations.
Most importers are also worried because the new external tariff will not only raise the cost of clearing goods but will also increase the many uncleared goods particularly, vehicles at the ports.
Mr Asakitold Business Finder that the new import levies which are on the high side will kill many businesses.
“If Ghana was going to enforce the ECOWAS Regional Common External Tariff, it should have reviewed the many taxes downwards to favour businesses”, he added.
A worried importer, Samuel Oppong, told this paper that the many taxes being charged at the port is frustrating his business, leading to increases in cost of operations.
Michael Yeboah, a clearing agent at Tema also said “I cannot tell what will be happening in the coming days ……..importers are not clearing their goods and we are losing out on business. If things don’t improve many of us will stay home without jobs.”
The ECOWAS Regional Common External Tariff which came into force on Monday February 1, 2016 replaces the Harmonized System and Customs Tariff Schedule.
According to a statement from the Ghana Revenue Authority (GRA) copied to the Manager, GCNET; the Manager, West Blue Consulting ; the Head of Tax Policy Unit of the Finance Ministry among others, “all issued CCRVs which remain unutilized as of January 31, 2016 will be reissued to reflect the tariff changes with effect from February 1, 2016.”
It added that all declaration will be passed using the new applicable tariff rates.
But, declarations passed before February 1 which remained uncleared will be processed using the old rates.
Goods warehoused before February 1, 2016 will be categorized as ex-warehoused using the Common External Tariff rates.
Overaged penalties on used vehicles will on the other hand continue to be charged at existing rates by user-definition in Ghana Customs Management System.
The processing fee of one percent will also continue to be payable on zero-rated and exempt goods.
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