Recently, importers have lamented having to pay such hefty tariffs on items brought into the nation.
They have also bemoaned how quickly the local currency, the cedi, is losing value in comparison to other major trading currencies, particularly the US dollar as we approach the holiday season.
Sampson Asaki Awingobit, executive secretary of the Importers and Exporters Association of Ghana, commented on this developing situation and questioned why the Ghana Revenue Authority’s Customs Division determines import duty charges based on Cost, Insurance, and Freight (CIF) rather than Free on Board (FOB).
According to Investopedia, Cost, Insurance, and Freight (CIF) is an international shipping agreement, which represents the charges paid by a seller to cover the costs, insurance, and freight of a buyer’s order while the cargo is in transit. Cost, insurance, and freight only applies to goods transported via a waterway, sea, or ocean.
Free on Board (FOB), on the other hand, is a term used to indicate when the ownership of goods transfers from buyer to seller and who is liable for goods damaged or destroyed during shipping.
It added that “FOB Origin” means the buyer assumes all risk once the seller ships the product.
According to Mr Awingobit, calculating import duties using CIF at a dollar rate of GH¢9.50pesewas from the initial GH¢7.2 is making life unbearable for the business community.
He added that there is no clause in the Customs Management Act (Act 891) that gives customs the room to charge in foreign currencies, especially US dollars.
“I see no reason why customs will use the CIM to calculate my duty and pay higher amount and whether I like it or not, I have to call somebody and pay. That is what is happening in this country. It is a way of robbing importers in this country. Customs is a government agency, Bank of Ghana is the one managing the currency of this country…On September 27th, Customs were using 7.2 dollar rate to calculate it. By the following week, the rate had moved from 7.2 to 9.5. This is a total robbery and that is how we go to the port today and the duties at the ports are untouchable,” he told GhanaWeb in an exclusive interview.
“It’s untouchable because everybody is running helter-skelter. We cannot pay the duties. Let’s all respect the Bank of Ghana rules, customs should not calculate duties based on CIMs but rather on FOB price because that is the only area that at least importers can have rest,” Awingobit stated.
He called on the Bank of Ghana (BoG) to call the Customs to order and stop them from charging in dollars.