GRA Removes Benchmark Value Policy
The Ministry of Finance and the Ghana Revenue Authority (GRA) have cancelled benchmark value policy on all import duties at the country’s ports.
A memo from the Commissioner to all sector commanders signed by Iddrisu Iddisah Seidu, the AG Commisisoner, Customs Division chanced upon by AfricaOwn.com holds, effective January 2023, the 30 percent discount on import values of general goods and 10 percent discount on home delivery value (HDV) of used vehicles will no longer apply.
That, as a result, valuation of all goods will continue to be done in line with the World Trade Organization (WTO) valuation agreement, WCO Customs Valuation Compendium and the customs act 2015 (act 891) section 60 on used motor vehicles and section 67 relating to general goods.
Another letter signed by Amishadai Owusu Amoah, Commissioner General to all ports and stations, confirms the directive.
Benchmark Value Discount Policy was introduced in April 2019 in order to make the Ghanaian ports competitive, reduce smuggling and increase government’s revenue from the period.
The policy provided a discount of 50 percent on the benchmark values of imports with the exception of vehicles.
It also provided 30 percent discount on the delivery values for used vehicles.
But, Government was said to have lost about GH¢9 billion in revenue from taxes generated on imported goods as a result of the introduction of the benchmark values which resulted in reduction of duties.
The said amount was lost between April 2019 and March, 2022.
Meanwhile, albeit the reduction in duties, there was no corresponding reduction in the prices of imported goods on the Ghanaian market.
The Association of Ghana Industries (AGI) has vehemently opposed the policy arguing that it had cheapened imports and dampened demand for local substitutes, leading to the collapse of local manufacturing companies.
According to the Association, while a number of countries offered export rebates to their firms to develop export trade, Ghana’s benchmark discount policy offered universal import rebate that only promoted importation and that policy distorted the micro and macro-economic fundamentals.
Guided by the overarching framework of Ghana’s industrial transformation agenda, one district, one factory (1D1F) initiative, Planting for Food and Jobs, Fertilizer subsidy and Ghana’s export development agenda, the AGI is of the view that the benchmark discount policy in its current form runs counter to the government’s own agenda to industrialise.
However, in the 2022 Budget Statement, government expressed it plans to review the policy in respect of all imports followed by a communication to remove the discount policy.
The government halted moves to remove the discount policy to allow for extensive stakeholder engagement on the viability of the policy and its impact on both government revenue and the domestic manufacturing industry.
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