ICC-Ghana advocates new guide on customs valuation

The International Chamber of Commerce-Ghana (ICC-Ghana) and the World Customs Organisation (WCO) have released a new guide on customs valuation and promote revenue package, the ICC-Ghana office has said. 
 
The guide seeks to underline the closer cooperation and coordination between customs and tax authorities which are key factors for further progress in enhancing international trade.

The chairman of ICC-Ghana, Alhaji Asoma Banda who presented the documents on behalf of ICC said: “The document is the results of the collaboration between ICC and the WCO as a new guide on customs valuation as part of the WCO revenue package. It also focuses on the use of transfer pricing information to examine international transactions to government.

He observed that international businesses face major difficulties due to discrepancies regarding the valuation of goods and diverging customs and tax rules regulating transactions between related parties, hence the introduction of this timely guidelines. 

A statement copied to the B&FT proposed seven innovative and pragmatic solutions based on convergence to secure, clarify and simplify transfer pricing and customs valuation rules.

“As the world business organisation, the ICC confirms that multinational companies, from all sectors and in every part of the world, face difficulties with respect to the valuation of goods. 

“These difficulties arise because transactions between related parties are subject to both customs and fiscal examinations and are thereby bound by differing rules and contradictory interests. 

“ICC believes these examinations should yield the same value and that a resolution to the problem is in the interests of all concerned,” the statement said.

The statement added: “Tax and customs administrations, even within one country and sometimes within the same government department, have different approaches: tax administration focuses on intra- group sales’ prices that may be perceived as higher than they should be; whereas customs authorities control imported goods for which prices may be perceived as lower than the market price. 

“While both administrations seek to achieve the same goal, which are arm’s length pricing, revenue interests in the transaction still remain at odds with each other. 

 Tax and customs administrations often set rules independently for the same transaction/good. Tax authorities seek conformity with the Organisation for Economic Co- operation and revenue generation.” 

ICC therefore recommends a focus on how these principles can be more closely aligned and made acceptable to both government authorities and the private sector. 

ICC-Ghana is spearheading an educational campaign aimed at collaborating with all affiliated government, ministries and department and agencies to highlight the various principles adopted by international bodies to ensure the implementation of this customs valuation at the country’s borders.

Currently ICC boost of a ready work with intergovernmental organisations such as the Organisation of Economic Co-operation and Development (OECD) and the World Customs Organisation (WCO) on this highly complex and contentious area within the global tax and customs world. 

 The campaign has become necessary at the time when the Customs Division of the Ghana Revenue Authority (GRA) has been given the green light to take full responsibility for valuation, classification and risk management functions at the country’s ports beginning September 1, 2015, under what has been termed as a National Single Window.

This means that from September 1, 2015, the Customs Division shall begin the processing of the Customs Classification and Valuation Report (CCVR) which shall replace the destination inspection report also known as the Final Classification and Valuation Report (FCVR).

This development which will be in conformity with the global best practice in the international trade protocols seeks to promote trade facilitation among nations for economic growth and prosperity.

ICC Ghana sincerely hopes that governments will take on board the recommendations proposed in the WCO guide as increased coherence between customs and tax rules will not only help reduce legal uncertainty, trade costs and the risk of penalties, but will also lower the risk of double taxation, and enhance cross-border trade and investment. It is in the interest of all concerned that tax and customs examinations result in the same value determination.