Gov’t Succumbs Pressure, Cuts duties on imported cars by 30%

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The Akufo-Addo administration has finally bowed to pressure from importers and traders for the reduction in the cut-throat duties at Ghana’s ports.

Vice President Mahamudu Bawumia, who made this known today at a Town Hall Meeting by the Economic Management Team (ETM) held at the College of Physicians and Surgeons, said the implementation of the policy, begins tomorrow.

Cabinet had crafted the policy, after a critical assessment of Ghana’s port charges regime, which is among the highest in West Africa. According to Dr. Bawumia, the policy had been arrived at after a Ports Review Committee that Government had set up, discovered that Port duties had been going up because of unnecessary charges and fees that have found their way into system.

Per the Committee’s findings, the total charges and marine fees for container handling at Tema far exceeds those of Ghana’s key competitors, except Nigeria. The charges at the Tema Port are three times higher than what pertains in Lome and two times higher than what pertains in Abidjan.

“No port in Africa is charging maritime security fees of nearly $20,000!” Dr. Bawumia lamented.

“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,” the Vice President announced.

According to the Vice President, what even makes the physical examination a non starter is that it only adds 0.3% to the revenue that Government gets from the Ports.

The Port Review Committee also found out some of the port charges are a percentage of the value of the goods imported, a thing Dr. Bawumia said unnecessarily makes them exorbitant. “Why should the cost of printing documents for instance, be value of percentage of goods? In most ports around the world these are flat charges,” Dr. Bawumia said

Again, he said, the benchmark value also applied by Customs in computation of import values are much higher than what pertains in Lome Abidjan and Dakar – in some cases 100 to 200% higher.

It is due to all these components that the charges are exorbitantly high at Ghana’s ports, he said, and this has led to many importers detouring their imports from Ghana to places like Togo and Ivory Coast. Per available data, it has also resulted in increase in diversions from Tema to Lome.

Between 2013 to 2018, container volumes increased by 300% in Lome, while it increased by just some 4.1% for Ghana between 2013 and 2016.

The Vice President, reiterating the start of the new duties regime at the Ports tomorrow, directed the Ghana Customs to adhere to risk engine of the paperless Port system which detects contents of goods digitally, so that the manual checks which result in serious delays will reduce.

He said, government envisages that by June this year, physical inspection of containers at the ports will reduce from 90% to 10%.

However, the announcement has been received with mixed reaction, particularly from some Ghanaians in the diaspora.

“We wished the government would have reduced import duties on cars by as much as 50% because of the outrageous ratio of duties on the actual cost of vehicles we buy to Ghana,” a Ghanaian living in Germany told Whatsup News.

Traders particularly at the automobile spare parts enclave in Abbosey Okai-Accra have been up-in-arms against the government for refusing to cut import duties as promised for more than 2 years of assuming power.

Critics say agitations from constituencies such as the diaspora and the Abbosey Okai business men is responsible for the government’s announcement.

Also announced by the Vice President is the significant reduction in the physical examination of containers at Ghana’s ports.

“Also, the physical examination of containers is to be reduced from over 90% to under 10% by June 2019. Customs and any other government operatives at the ports should adhere to the recommendations of the risk engine under the paperless regime. 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 joint examination which must include National Security,” Vice President Bawumia announced.

Source: Whatsupnews Ghana

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