By Adu Koranteng
The government says effective today, Thursday, April 4, there will be a reduction in import duties at all of the country’s ports.
Vice President Dr. Mahamudu Bawumia, who disclosed this at the Economic Management Team (EMT) town hall meeting yesterday said, import duties would be reduced by 50 per cent while importers of vehicles will enjoy a 30 per cent reduction.
During a recent visit to Worchester, Massachusetts, President Akufo-Addo told a crowd at a Town Hall meeting that he plans to reform Ghana’s import duty regime with the intent to alleviate high taxes at the country’s ports.
He assured Ghanaians that government is already working on the deal and indicated that he is aware of petitions received by the state to revise the current import duty regime.
“We have realized from the studies we have done that our ports are not competitive, and the imports regime in our country is far too high,” he said.
“We are dealing with it, and, very soon, the measures that government will roll out will become known to all of you. I am not talking next year, or in 6 months’ time, I am talking very, very soon.”
According to the Finance Minister, Ken Ofori-Atta, the introduction of the new paperless port system has reduced costs.
He added that “the results (of the Paperless Port system) showed that the cost components of doing business at the country’s ports have reduced from seven to three cost components. This has, subsequently, reduced the total costs from ¢1,280 to ¢320.”
“This means that the paperless system reduced the cost of doing business at the ports by ¢960 representing 75 per cent savings. Hence, importers are now making savings of 75 percent as a result of the implementation of the paperless system.”
The wait is over as Dr. Mahamudu Bawumia said Cabinet has approved for the reductions to take effect on Thursday.
“To reduce the incidence of smuggling and enhance revenue, the benchmark or delivery values of imports have been reduced by 50 percent except for vehicles which will be reduced by 30% effective 4th April 2019.
“This means, for example, if a container was previously assessed for duty at a value of $20,000, it will now be assessed from tomorrow at a value of $10,000. We expect that the higher volumes of at least 50% annually and increase custom revenue,” the Vice President said.
According to him, the physical examination of containers is to be reduced from over 90% to under 10% by June 2019, and Customs and any other government operatives at the ports should adhere to the recommendations of the risk engine under the paperless regime.
He stated that the risk engine allows for the incorporation of specific intelligence on containers.
“Where containers are selected by the risk engine for examination, there will be a joint examination which must include National Security. There should no longer be separate examinations of containers by any government operative at the gates of exit,” Dr. Bawumia told a cheering auditorium.
Again, he announced that government will begin the implementation of the First Port Rule in June 2019 so that duty on all transit items will be paid at our port to the Customs representatives of the country of destination.
“We will implement a strict “no duty no exit” policy for containers without exception. This will block leakages and increase revenue. Going forward, Ghana will adopt a flat fee structure for port and customs charges for any new single window operator in line with best practices of charges at major ports globally,” Chairman of EMT said.
Subject to Parliamentary approval, government will also implement the following measures on port charges to enhance the efficiency of port operations.
– Abolish service charge of $1.50 per ton of every export and reduce by 50% the $2.0 per ton of every import levied by Ghana Shippers Authority.
– Abolish importer registration fees imposed by the Ghana Standards Authority.
– Abolish the recently introduced Eazy Pass levy of up to 0.5% of the CIF value of goods by Ghana Standards Authority.
– Review the security charge of $0.50 per gross tonnage of every vessel coming into Ghana’s waters charged by Ghana Maritime Authority (GMA).
– Reduce by 50 per cent the $7 per new tyre eco levy charged by EPA, and replace the eco levy of 0.5% CIF value charged by EPA on a number of import items by a flat fee.
Vice President Dr. Mahamudu Bawumia disclosed that in order to deal with the lack of information on the status of a consignment and the duty payment, a mobile app has been developed to enable importers to check the status of their consignment and the import duty payable online.
“The app can be obtained on Google Play store and will also soon be available on iTunes. It is called the Ghana Trade Hub mobile app. An importer just needs to have an Import Declaration Form number to access the information,” he said.
Minority Casts Doubt Over 50% Slash In Import Duties
Minority Spokesperson on Finance, Casiel Ato Forson, has cast doubt government’s announced slash of import duties by up to 50%, will materialise.
“I will challenge any individual to go to the port and clear your goods,” he told a pool of reporters at the end of a Town Hall meeting where the Vice-President, Dr Mahamadu Bawumia, announced the reductions.
Ahead of an official NDC response expected Thursday, the former Deputy Finance Minister, Ato Forson branded the new policy “populist,”
He predicted, “Abossey Okai will happen again”.
By that, he was referring to a jubilation of spare parts dealers mainly in Abossey Okai after government announced in March 2017, it had abolished duties on spare parts.
But the dealers have been grumbling that the announced abolition has had no impact on the cost of clearing their goods.
A disappointed shop owner would tell Joy News some nine months after that “can you believe that when we went to clear our goods things were the same…it was even higher.”
Another said he used to pay ¢2,500 but now paid ¢5,000. The spare parts dealers complained of a raw deal and threatened not to spare the Akufo-Addo government in 2020 when the country goes to the polls.
Government has admitted a new measure for the valuation and calculating duties introduced by the Ghana Revenue Authority is responsible for the situation.
Looking back at the Spare parts saga and the love of the dealers turned cold, the Minority Spokesperson indicated he foresees a replay with the latest announced reductions.
With the reductions expected to take effect in the next 24 hours, Ato Forson volunteered, he will go to the ports and interview importers.
“So tomorrow go and clear your car. I expect a 30% reduction. If you fail to get 30% reduction then again he has lied.”
