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Watch it, fruit juice importers adopt new tricks

BY: James Kwegir
Some containers at the port.

On September 1, 2015, the Customs Division of the Ghana Revenue Authority (GRA) assumed full responsibility for destination inspection at our various ports of entry with the view to perking up customs procedures, which would eventually lead to improved revenue generation.

Given the fact that there are revenue leakages all over the place, some of us heaved a sigh of relief that the government was finally making some efforts to plug loopholes and bring efficiency into the system to enable it to derive the much needed revenue for national development.

But just when one thought the discrimination in the application of duties on some imported items or, better still, the underdevaluation of some brands of imported fruit juice by local importers at the Tema and Takoradi ports would be a thing of the past, we were made to laugh from the wrong side of our mouths.

Oh yes, it is said that ‘a leopard cannot or does not change its spots’. Or, if you like how Jeremy Belkump, an American clergyman and historian of blessed memory, simply puts it: ‘Old habits die hard’. So, not surprisingly, we were to see importers quickly change their methods to continue to rob the nation of millions of cedis while raking in huge profits.

Modus Operandi

So, what is their new modus operandi? What have the importers been up to in a bid to continue to outwit customs and the nation? Let’s look at a few: Some of the importers have now adopted the technique of mislabelling  the imported items. For instance, if they import Don Simon, they label it as wine and supermarket products, thereby attracting less tax on the imported items.

What really beats one’s imagination is whether Don Garcia, the renowned suppliers of Don Simon, are also involved in this type of transaction or it is just the work of the importers. Whatever it is, one strongly believes that it should not be too difficult for the Economic and Organised Crime Office (EOCO) and other related government agencies to uncover the rot.

Is it not a crying shame that one single individual - Anas Aremeyaw Anas - and his Tiger Eye PI can do so much on corruption and fraud in this country when people who are paid from the taxpayer’s sweat and toil to undertake such duties sit in their comfort zones with little or nothing to show?

In declaring the quantity of items, these fruit juice importers describe them in lots instead of containers and the intention is clear – to beat customs on the actual number of the items brought into the country on a given day.

What really saddens me is that some of the leading malls currently operating in the country are involved in this kind of under-devaluation. This daylight robbery cannot be allowed to continue forever. We  as a nation must rise up to uproot the canker.

Only recently, I heard President John Dramani Mahama lamenting that Ghana’s judges had become a laughing stock, both locally and in international circles, due to the recent corruption scandal uncovered at the Judicial Service.

“The Anas video has provoked all kinds of salacious conversations and discussions, both in private and in the media, and our judges regrettably have become the bat of jokes in chop bars and restaurants,” the President lamented.

Is anybody surprised? Why? What else must we expect if a government and its appropriate agencies virtually turn a blind eye on the rot in the nation and refuse to deal promptly with issues as they crop up? Just see how low we have sunk in the eyes of the international community. How long must we wait for the appropriate law-enforcing agencies to strike?

Corrupt practices

Is it not a pity that corrupt and fraudulent practices have become virtually a norm in the Ghanaian society rather than the exception as in other jurisdictions? Is it not sad that in Ghana, all governments since independence have been complicit in one form of corrupt practice or another?

Not surprisingly, Transparency International (TI) ranked Ghana 63 out of 177 in 2013 and 61 out of 175 in 2014 in its global corruption perception index.

Revelations of corrupt deals and malfeasance by the Auditor-General have become an annual ritual. The financial loss to the state through the Ghana Youth Employment and Entrepreneurial Development Agency (GYEEDA) management and operations amounted to GH¢4 million in a massive corruption scandal.

Ghana loses at least $1billion annually due to corruption with the figure projected to rise to $4 billion if anti-corruption measures are not instituted.

Barely a year ago, a report released by Global Financial Integrity (GFI), a Washington DC-based research and advocacy organisation, said the government of Ghana lost potential tax revenue of $3.86 billion between 2002 and 2011 through trade misinvoicing, an average of $368 million a year.

The report released on May 12, 2014, said $14.39 billion in illicit capital flowed either into or out of Ghana due to trade misinvoicing, while under-invoicing of exports amounted to $5.1 billion and under-invoicing of imports came to $4.6 billion.

The report also revealed that the under-invoicing of exports was the primary method for shifting money illicitly out of the country, while the under-invoicing of imports was used mainly to illegally smuggle capital into the country.

As a result of those illicit financial deals, Ghana’s tax loss has been put at roughly 11 per cent of total government revenue over the past 10-year period.

One would have thought that such a damning report would make all our agencies wake up from their slumber, pull their resources with the view to plugging the loopholes which are taking such a serious toll on the nation’s economy but, unfortunately, the study has not impacted on our efforts to curb such illicit financial flows.

It must be stressed that fraudulent trade transactions rob the people of funds that could otherwise have been used for investments in infrastructure, schools, hospitals, and other much needed public services.

Less money to spend

The potential revenue loss from trade misinvoicing means that Ghana has less money to spend on health care, less money to devote to education, and less money to invest in infrastructure but I don’t think that is what any caring government wants.

There is therefore the urgent need to shut down the channels through which illicit money flows and nobody can do so better than the Customs Division of the GRA. Or are we waiting for Anas to pull his trigger again before we all start running helter-skelter?

Sad to say but under-invoicing of imports in Ghana in recent years has reached cancerous proportions and is demonstrating a negative impact on the country's development process. The people at the helm of affairs know what is right yet they condone and connive with importers to rob the nation of millions of cedis.

Do we care about the growth of local industries? Do we really care that some companies produce the same products in the country, pay the right taxes and give employment to many Ghanaians but some of the fruit juice importers undervalue theirs and are able to sell at cheaper prices because they pay less to the state in terms of taxes? Is that proper? Is that right? Is that what real competition is about?

This issue about under-devaluation of fruit juice imports is not coming up for the first time? Or is it? So, why are we burying our heads in the sand like ostriches? Why are we behaving as if everything is fine? Our attitude is simply disgusting! It’s incredible!!

It is time the government walked its long, winding talk over the years and demonstrated the required political will to quickly prosecute all known corrupt persons, be they politicians, ministers of state or public officials, to serve as deterrent to others who see their positions as an easy avenue to loot the resources of the nation.

Until that is done, we shall all continue to weep for you, Ghana, our motherland.