Govt seeks to lighten importers’ burden
The Ministry of Finance wants to reduce the contribution of customs revenue to the nation’s tax revenue from 40 per cent to 20 per cent.
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The Head of Tax Policy at the Ministry of Finance (MoF), Mr Anthony Dzadzra, disclosed this in an interview with the GRAPHIC BUSINESS on the sidelines of a forum which was organised by the American Chamber of Commerce Ghana on the country’s fees and charges for import, export and transit trade.
Currently, he said, the Customs Division of the Ghana Revenue Authority (GRA), through import duties, contributed about 40 per cent of the total revenue of the country.
“We are looking at reducing it to about 20 per cent. If possible, we should even reduce it to about five per cent because that is the practice in developed countries,” he stated.
He said the government would improve efficiency in tax collection to make up for the losses that would come from the reductions of the import fees and charges.
The ministry is, therefore, in the process of reviewing all fees and charges at the ports to ensure that the fees that are charged by the various Ministries, Departments and Agencies (MDAs) are commensurate with the services they render.
In the case where two MDAs perform the same functions but charge different fees, the government is putting in place measures to ensure the individual pays for just one.
This is all in a bid to reduce the cost of doing business through the ports of the country, in line with the World Trade Organisation’s (WTO) Trade Facilitation Agreement (TFA), of which Ghana is part.
Process to review IGFs underway
The ministry is also reviewing the policy that governs internally generated funds (IGF) of MDAs in a bid to get rid of some unnecessary fees and charges by them, especially at the country’s ports.
Consequently, the MoF has set up a committee to draft a new policy that will be captured in the 2018 budget to govern IGFs in the country.
Mr Dzadzra said the policy would also set out what optimum fees and charges at the ports and other agencies should be, bearing in mind the country’s commitment to periodically review its fees and charges with a view of reducing the cost of doing business.
“We are reviewing all IGFs and not only for the ports. There are a lot of MDAs who charge fees as well aside the ones at the ports, so the idea is to look at the kind of fees these MDAs are charging Ghanaians and see whether those fees are relevant in the operations of these MDAs,” he stated.
Trade Facilitation Agreement
Addressing members of the Chamber on the increasing fees and charges levied by MDAs especially at the ports and in helping Ghana’s ports become more efficient, Mr Dzadzra said the government was confident that the recently ratified TFA by the members of the WTO would help reduce the cost of doing business in the country, especially with the import and export business.
Ghana ratified the WTO TFA in January 2017, with the multilateral agreement later entering into force when the WTO obtained two-thirds acceptance of the agreement from its 164 members.
He said the agreement would enhance effective cooperation between customs and other actors on trade facilitation and customs compliance matters.
“An important component of this agreement is the capacity and technical assistance it will offer countries like Ghana,” he said.
“The theme of today’s event even relates to Article 6 of the agreement, which deals with disciplines on fees and charges imposed on or in connection with importation and exportation,” he added.
He said the ministry was fully aware of the gains for both the public sector and the private sector in making the WTO TFA work.
“The ministry has taken note of the challenges that are likely to impede the seamless implementation of all aspects of the TFA, including the rationalisation of fees and charges being imposed at the ports by MDAs, some of which are not directly under the control of the MoF,” he noted.
Cost of trading in Ghana
The United States (US) Ambassador to Ghana, Mr Robert P. Jackson, used the occasion to also launch the ‘Cost of Trading in Ghana’, a study that was conducted by the US Agency for International Development (USAID) on the impact of trade-related fees and charges.
The study was part of the country’s efforts to comply with benchmark guidelines outlined in the WTO’s TFA.
It showed how official and unofficial fees and charges associated with trade impacted on Ghana’s trade volume, government revenues and private sector viability.
Mr Jackson noted that the adoption of the study’s recommendations and implementation of the TFA would foster increased economic growth in the country.
“Ghana has tremendous potential to be the trade gateway of Africa and the US will work with you to create an enabling business environment that builds on your economic and political stability to create jobs for citizens of both countries,” he said. —GB
