Government of Ghana will soon clamp down on malpractices identified in the Transit Trade regime in the country, Deputy Minister for Finance Kwaku Kwarteng announced here on Friday.

According to him, some goods that were declared at the country’s sea ports as transit goods en-route to Burkina Faso never found their way out of the country.

Speaking at the 2008 Pre-Budget stakeholder conference, the deputy minister pointed out that the practice was a drain on the nation’s revenue and needed to be stopped.

As part of international trade arrangements, traders who declare their imported goods as transit goods are not required to pay the taxes that ordinarily would be paid if imported into the country. There is a regime for monitoring and ensuring that these goods actually leave the country.

“But our discovery is that a good number of times, these goods do not leave. They drive to quiet places in the country; they off0load them and it enters into the domestic market. It is quite widespread and we are going to wage war on that practice,” Kwarteng announced.
He added: “We are going to open a new battle front and ensure that people who are required to pay taxes pay their fair share of the taxes.”

Although there are no specific figures readily available to ascertain the quantum of revenue losses through this alleged practice, the deputy minister suggested that the figures could be huge based on the volume and value of transit trade between Ghana and Burkina Faso.
“You just can tell that given the number of people and quantity of goods being declared as transit goods and the engagement we are having with the Burkinabe government, it is clear to us that you do not have a corresponding amount of goods entering their country as transit from Ghana,” he explained.

Such goods, according to the deputy minister, definitely end up in the domestic market, promising that government was up to the task and would take steps to fight them.

Kwarteng added; “I am sure, as we begin to work on it, we may be able to provide some quantitative figures but it is sufficient to add that it is an irregularity that is prevalent and we are going to deal with it. We will implement the law and ensure that wrongdoers are punished and discouraged from doing same going forward.”

Lower than projected tax revenue has been one of the low points in Ghana’s fiscal management during the first half of the year, forcing government to slash expenditure by 3.6 billion Ghana cedis or 820 million U.S Dollars during the first four months of the year.
In August, Finance Minister Kenneth Ofori-Atta announced a downward revision of spending plans “to conform to lower than projected revenue in order not to compromise fiscal consolidation”.

Total Revenue and Grants was revised downwards by 0.9 percent of GDP (Gross Domestic Product) from 44.5 billion Ghana cedis (10.11 billion U.S Dollars) to 43.1 billion cedis (9.79 billion dollars), while total expenditure was also revised downwards by 1.1 percent of GDP from 58.1 billion cedis (13.1 billion dollars) to 55.9 billion cedis (12.6 billion dollars). Enditem

Source: Xinhua/NewsGhana.com.gh

LEAVE A REPLY

Please enter your comment!
Please enter your name here