Government suspends 50% benchmark value on imports

In 2019, the government declared a 50% reduction in import values at the ports to make trade through the ports more attractive as well as boost revenue mobilisation

The government has suspended the 50% benchmark values on selected general goods and the 30% on vehicles to make the measure more efficient and targeted.

Presenting the 2022 Budget Statement and Economic Policy in Parliament on Wednesday (17 November), Ofori-Atta said the move was consistent with the government’s policy to promote local industry and improve foreign exchange earnings.

He said the government has restored “the benchmark values of imports by suspending the 50% discount on selected general goods and the 30% discount on vehicles.”

He said the government was committed to a programme of turning enterprising traders into manufacturers of widgets, tools and other machinery necessary as inputs for industrial growth.

The government has also reviewed the Value Added Tax (VAT) Flat Rate of 3% of the sale price of goods was introduced on the supply of goods by wholesalers and retailers.

The review will limit the Flat Rate to only retailers and provide a simplified system for small scale enterprises to make local goods with imported substitutes competitive.

To ensure the objective of the review is achieved, Ofori-Atta said the rate would be applied to retailers with annual turnover not exceeding GHC500,000.

All other retailers and wholesalers will be charged the standard rate, he said.

The minister said in 2019, VAT relief was provided on African prints for textile manufacturers to enable them to resuscitate their operations and provide affordable textiles to the market. That policy, he said, had succeeded in stabilising the industry and formed the basis for a modest increase in production.

He said the companies had also maintained their prices over the period, making the cost of local prints affordable.

Additionally, the companies had been able to keep their employees and made some investments in the industry as a result of the Policy.

The minister said to consolidate the gains and expand production in the industry, the government had decided to extend the Relief for a further two years.

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