Customs, plug these loopholes
One of the cardinal reasons which saw the Customs Division of the Ghana Revenue Authority (GRA) assuming full responsibility for destination inspection at our various ports of entry since September 1, this year, was, among other things, the need to simplify trade facilitation processes, enhance the coordination of border management arrangements with other government agencies and, above all, to make customs procedures more efficient which would eventually lead to improved revenue generation.
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Indeed, it is an open secret that there are revenue leakages all over the place and every effort has to be made to plug them to bring efficiency into the system to enable the government to derive the required revenue for national development.
History of DICs
In Ghana, the concept of destination inspection was introduced by the government in 2000 to replace the pre-shipment inspection system which involved the inspection of imports before shipment from the country of supply. The Destination Inspection Companies (DICs) were mandated to inspect imports at the country’s ports of clearance.
Until September 1, five DICs namely: BIVAC International, Gateway Services Limited, Ghana Link Network Services, Webb Fontaine Ghana Limited and Inspection Control Service, had been operating in the country.
In a recent interview with the Daily Graphic, the acting Assistant Commissioner of the Communications and Public Affairs Department of the GRA, Mr Robert Mensah, said one of the defects in the operations of the DICs was the “frustration of trade facilitation efforts by the government as a result of the non-uniformity in the cargo clearance procedure and inefficiency”.
That, he explained, was because “the destination inspection system showed the absence of a harmonised risk management system among the various service providers and the scheme was more costly to operate than in-house operations”.
It is also on record that since 2013, the operations of DICs had come under criticism for their arbitrary charges at the ports and work processes which importers claim caused congestions at the ports.
Some importers claimed that the many interventions by the DICs, such as evaluation, reclassification and scanning discrepancies, were frustrating.
Campaign against DICs
A former Commissioner of the Internal Revenue Service (IRS) now under the GRA, Major Daniel Ablorh-Quarcoo (retd), who was one of the leading voices in the campaign to scrap the operations of DICs in Ghana, accused the companies of dampening the government’s efforts to mobilise tax resources and also reduce the cost of doing business in the country, as they charged fees for every work done.
But despite all the goodwill and trust, one issue has remained unresolved even with the Customs Division of the GRA now at the helm of affairs – and this has to do with DISCRIMINATION IN THE APPLICATION OF DUTIES (caps mine) on some imported items.
I am referring specifically to the UNDERDEVALUATION of some brands of fruit juices by local importers at the Tema and Takoradi Ports. Not too long ago (in May, this year), the Daily Graphic did its own investigations into the complaints of the local fruit juice producers and the paper’s revelations were very startling.
For instance, the paper told the whole world that “on March 4, 2015, a particular company (name withheld) per Entry Number 42015005439 brought in Don Simon Multifruta Nectar and was made to pay Euro 0.31 per litre.
“On that same day – March 4, 2015 – another company (name withheld) per Entry Number 42015084505 also brought in Don Simon Multifruta Nectar and was made to pay Euro 0.49 per litre”.
Why should it be so when in 2014, a minimum guideline for tax of around US$0.85/litre (approximately Euro 0.77/litre) was set for inspection companies?
Let me reiterate the question: who doesn’t know where Don Simon is imported from? Why must such a product be subjected to different tax regimes? How are taxes calculated? Who are behind this blatant tax evasion and why are these corrupt practices being allowed to continue despite persistent protests from industry players?
Must it be business as usual even with the change in our custom procedures and personnel? Our dear nation has lost millions in taxes at the Tema and Takoradi ports over the past few years and we cannot allow this to continue? Or we are waiting for another exposè from Anas Aremeyaw Anas’ TIGER EYE (just as he has done to some corrupt judges in the system) before we wake up from our deep slumber as a nation?
Customs’ clear mandate
The Customs Division of the GRA has been given a clear mandate to plug all loopholes and ensure that appropriate taxes are levied on imports to enable the government to prosecute the nation’s development agenda and there can be no compromise.
These corrupt practices have dragged on for years and one would have thought that they would engage the immediate attention of the officials as they took over from the DICs but this was not to be. It’s really sad and disappointing.
It is, however, not the end of the road. We cannot continue to condone such obnoxious practices. All the culprits must be exposed and brought to book. Ghana deserves better.
It is on record that when the Nigeria Customs Service (NCS) phased out the system of destination inspection, they did not only reduce the clearance time and lower the cost of doing business in Nigeria but, more importantly, saved Nigeria more than $25 million monthly in revenue loss.
The Customs Division of the GRA has men and women who are capable of performing a similar magic in Ghana, if they work with a lot more commitment and dedication. A new era has dawned and everybody must be prepared to die a little for our dear nation.
God bless our homeland Ghana. Amen.
