Gov’t Outdoors 2 Tax Policies … But Water Producers Cry

The National Association of Sachet and Packaged Water Producers (NASPAWP) has disclosed that its members have not been able to acquire the tax affixing machines.

The NASPAWAP expressed the concern following the introduction by government of two new tax policies – the Excise Tax Stamp and the Harmonized ECOWAS Common External Tariff (CET).

It’s also expected to introduce a third tax soon on fumigating containers and their contents at the Tema Port.

In a letter endorsed by its national executive committee, it said: “Members are not in a position to acquire the machines.”

It said members have therefore resolved that producers could access the government tax stamp affixing machines at the Tema Port in the interim.

They have also agreed that all bottled water companies would meet on Monday, March 5, 2018, to assess the current situation and decide on possible shutdown, if necessary.

According to IMANI, a leading policy think tank, “even though importers had also asked for leniency, it appears the development was a tough balancing act for Ken Ofori Atta, Finance Minister whose basket of promised social goods need sufficient cash, but at the same time he needs to ensure the private sector is not unnecessarily overburdened to achieve the political goals.”

In a release issued recently in Accra and signed by Franklyn Cudjoe, its Executive Director, IMANI noted that “it does seem until the local business environment is deliberately induced to boost domestic enterprise and manufacturing that can compete with basic goods and services we import, there would only be the option to tax the joy out of import business. That is assuming all the taxes so imposed go into the government’s vaults.”

“In any case, the fortunes of the importer may actually be dwindling with yet another Fumigation tax. The cargo fumigation levy had been contemplated under the previous administration which did not see the light of day because of a change in government.

It continued: “Now though it has been given full support by the current administration – the fumigation of cargo is to be undertaken by a Turkish company – which is the service provider, with the Shippers Authority as client and the Ghana Health Service as health regulator.”

All stakeholders in the import business, especially freight forwarders have been served notices to register online by today, March 1, 2018 in order to pay $5 per each passenger car imported and disinfected. All other vehicles will pay $10 each.

It is envisaged that all containers for imports and exports will be subjected to similar unspecified fees and could be higher. These charges do not include VAT or any other tariffs government may impose.

“There is nothing essentially wrong with disinfecting cargo as disease agents can be transported to hitherto safer environments. However, it is important to ask the critical question of how unique this service is that it merited a sole-sourced procurement process which imposes very unfair terms on government’s agencies and by extension on importers. The fees seem to have been solely determined by the service provider.

“For a country that purports to be interested in ensuring skills transfer and some amount of local content, it is sad that a service that is not unique to be provided by an external company under these worrying circumstances certainly is a call to death of budding and experienced local enterprises.

“Mrs Brew Appiah-Opong offered economically sound advice on how to proceed with the agreement to ensure Ghana’s public private partnership and local content mantra was given a befitting facelift with this project. I agree with her legal opinion. I am not sure her opinion was factored into the June 23, 2017 agreement under the new government. Officials of IMANI are still demanding answers from those who signed this contract.”