IEAG calls on Gov’t to scrap taxes introduced in 2022
The Importers and Exporters Association of Ghana (IEAG), has called on the government to scrap some taxes it introduced in 2022.
In a statement issued by the Association on Sunday, January 15, 2023, the Association argued that scrapping some of the taxes on imports will help cushion traders and consumers.
Adding that importers and exporters have been at the receiving end of the current economic challenges.
According to the IEAG, government in 2022 introduced the GetFund Levy 2.5%, NHIL Levy 2.5% and the Covid Levy 1% which totalled 6%.
These levies, it noted, are charged on Cost-In-Freight and insurance (CIF) plus Duty at the point of clearance, meaning the charges amounts to 7.2% of CIF value.
“The same Levy is charged at the time of supply of goods from the wholesaler to the retailer, and onward from the retailer to the consumer. This means the total compounding Levy after these transactions are 28.8%,” it further noted.
“This shows clearly that if the government decides to scrap or review these levies, the current astronomical inflation rate could see a significant drop,” the statement added.
Headline inflation as at December 2022 stood at 54.1% driven mainly by steep increases in food, transport and housing costs.
Read details of statement below:
15/1/2023
PRESS RELEASE BY THE IMPORTERS AND EXPORTERS ASSOCIATION OF GHANA
GOVERNMENT MUST REMOVE COMPOUNDING TAXES CRIPPLING TRADERS AND IMPORTERS
The rippling effect of the country’s crumbling economy on businesses has become a major concern for the country at large. It is frustrating to note that Importers and traders are at the receiving end of these challenges which could have been long prevented with the implementation of drastic measures by the leaders in charge of the economy.
With inflation hovering above 50% coupled with the depreciation of the cedis in recent times l, the Importers and exporters association believes its high time government takes an urgent step in scrapping some of the taxes it introduced in 2022, so as to cushion traders and consumers as a whole.
It’s imperative to note that the current dollar rate at a buying and selling exchange is pegged at 13 and 11 Ghana cedis as of 15th January 2022. And this could have direct repercussions on both Importers and traders with the vulnerable public suffering the most.
In 2022 the NPP government introduced the GetFund Levy 2.5%, NHIL Levy 2.5% and the Covid Levy 1% which totalled 6%.
These levies are charged on Cost-In-Freight and insurance (CIF) plus Duty at the point of clearance, meaning the charges amounts to 7.2% of CIF value. Ironically these same 7 2% Levy is charged at the time of supply of goods from the Importer to the wholesaler. The same Levy is charged at the time of supply of goods from the wholesaler to the retailer, and onward from the retailer to the consumer. This means the total compounding Levy after these transactions are 28.8%.
This shows clearly that if the government decides to scrap or review these levies, the current astronomical inflation rate could see a significant drop.
We as well urge the government to maintain the current rate by customs at the Port for the next three months to cushion traders, since any decision by the government to go contrary based on the current dollar rate will rather worsen the plight of Importers and traders.
The association in unionism with its relevant stakeholders also call on the government to shelve the planned implementation of the 2.5 VAT levy owing to the fact that, “We are Not In. Normal Times”
Signed
………………..
Samson Asaki Awingobit
Executive Secretary
0243575046
