Review of customs law begins

The Ghana Revenue Authority (GRA) says the re-crafting of the country’s customs law will commence at the end of this month to harmonise and organize the administrative procedures and processes for effective revenue mobilization, the Authority’s Commissioner-General, Mr. George Blankson has disclosed.

The Customs Division of the GRA accounts for more than approximately 50 percent of total revenue collections agencies. Customs collected GH ¢ 3,604.82 million representing an excess of GH¢536.30 million against its last year’s revenue collection target.

Although the Customs collection is about 52 percent of total tax revenue from Import Duty, Import VAT, Export Duty, Petroleum Taxes, Import Excise and other taxes, it has relied on The VAT Service to collect Excise Duty on its behalf, except the Excise Duty on Petroleum products.

The Customs is expected to ensure the protection of revenue by preventing smuggling, but this is one area where it perceived by the public and the business community as weak.

As a frontline institution at the country’s frontiers, Customs also plays a key role in maintaining the territorial integrity of the country as part of the nation’s security network. In addition to these functions, Customs performs agency duties on behalf of other state institutions by enforcing laws relating to import and export restrictions and prohibitions.

Mr. Blankson speaking at a media interaction in Accra said: “The GRA's focus on the tax reforms has been on the review of the tax legislations for purposes of simplifying them and streamlining processes.”

“In this direction, a draft consolidated Administration Act, which brings together the administration provisions in the Act under which direct tax, VAT and indirect taxes and customs duties are administered, has been produced.”

He disclosed that a draft four year strategic modernization plan ending 2014 has been produced, and is expected to be the blueprint for the modernization of GRA.

“The management of GRA is devising strategies to increase revenue mobilisation to meet this year’s target and that it would focus attention on streamlining the operation of the customs bonded warehouses, Value Added Tax refunds, issuance of permits to boost revenue collection.”

“In spite of the challenges, the reform process is on course. GRA management is committed to ensuring that the objectives set for the modernization process are realized.

“Management will continue to maintain a careful balance between revenue mobilization and the reform agenda in the year 2012, to ensure that the revenue target is achieved and even exceeded to provide sufficient funds for national development,” he said.

The Authority anticipates to collect over GH¢11.16 billion for the 2012 fiscal year, after reforms helped boost collections in 2011.

This projection represents 28.3 percent over 2011 revenue collection of GH¢7.53 billion. The Authority as at December 2011 had collected GH¢8.71 billion, an amount that exceeded its target by 15.4 percent.

The revenue mobilisation performance for 2011 exceeded that of 2010 by 46.6 per cent, the GRA said.

Government in the 2012 budget statement predicts an increase in tax revenue from 16.5 percent of Gross Domestic Product in 2011 to 17.3 percent in this fiscal year.