GRA loses GH¢4.5 bn through fraud at ports - Finance Ministry

The Ghana Revenue Authority (GRA) has lost an accumulated revenue of GH¢4.5 billion over the past five years as a result of infractions by traders, importers and governmental agencies, the Head of Tax Policy Unit at the Ministry of Finance, Mr Daniel Nuer, has said.

That, he said, followed the abuse of the suspense regime system which consisted of warehousing, temporary importation, re-exportation and transit by some importers and traders engaged in the stated trades.

Warehousing, re-export and transit processes, he stated, allowed the Customs Division of GRA to defer tax revenue on imports, so importers and traders could only pay the needed revenue as and when they are ready to clear them for distribution in the country.

Mr Nuer intimated that the situation had seen some recalcitrant importers, traders engaged in diverting the imports for sale and consumption in Ghana without paying the requisite revenue to the authority, thus leading to loss of revenue to the government.

“We can no longer sit for people to continually defraud the state, while the state loses huge revenues”, Mr Nuer stated.

Measures

At a forum organised by the Maritime Courier Publications in Tema recently, Mr Nuer indicated that although administrative measures were in place to block the loopholes, some traders and importers, as well as some agents, often create other avenues to cheat the system.

The forum attracted representatives from the Ghana Maritime Authority (GMA), shipping lines, the Ghana Institute of Freight Forwarders (GIFF), the Berthing Meeting Association (BEMA), Customs and the Maritime Police Unit of the Ghana Police Service, as well as representatives of the Burkina Faso Chamber of Commerce.

The discussions focused on the Cargo Tracking Notes (CTN) policy, demurrage, container detention, rent, security and shipping service regulations.

Mr Nuer said GRA had imposed administrative penalties of about 300 per cent on traders / importers caught to have engaged in the abuse of the warehousing, re-export and transit mechanisms but the trend had not yielded any positive results.

Presently, the GRA, he said, was trying to introduce more mechanisms, including electronic monitoring to police the warehousing, re-export and transit regimes.

Prosecution

Mr Nuer hinted that the ministry had also encouraged the GRA to commence actions of prosecution of cases identified to have criminal element.



He suggested that whereas the GRA regulations made provisions for the institution of criminal charges against persons caught to be engaged in trade fraud, the slow nature of the justice system informed the decision to rather implement the administrative procedure where penalties are imposed on offenders.

“However, it seems that these actions are not being too deterrent, thus the ministry will support the GRA in any criminal action it intends to take against persons abusing the suspense regime”, Mr Nuer stressed and added that the ministry had thus made a commitment in the 2018 mid-year budget to that effect for the enforcement of compliance not only administratively but also using criminal procedures as well.

CTN

The Deputy Commissioner in charge of Operations, Customs Division of GRA, Mr Seth Dwira, gave an overview of the CTN policy and argued that the GRA had evaluated the policy and was convinced that its implementation would add value to the national single window platform.

Answering a question on why a stand alone system by way of CTN was created when the country’s Ghana National Single Window project was being implemented by harmonising all trade process flow, Mr Dwira intimated that the CTN allowed for external verifications to avoid incidents of fake invoices covering imports and served as a checklist for checking diversion of goods in transit.

Representatives of the Burkina Faso Chamber of Commerce questioned the slapping of the CTN charges on transit operators who he said had already paid such charges in their home country, but Mr Dwira pointed out that GRA would look at the regime and come out with modalities to address the challenges.



Freight forwarders

The President of GIFF, Mr Kwabena Ofosu Appiah, queried the rationale behind the policy, especially when the GRA had no representative at the port of loading where initial invoices covering cargos were to be first forwarded as an advance shipment information.

“We are being told this policy is a risk management tool aimed to give security, but how do you assume security when you were not present at the port of loading?” he asked.

He wondered why the Trade Facilitation Agreement (TFA) ratified by the government which made provision for advance shipment information was not being implemented but to look for an alternative measure which might not be cost effective.

“If you want to introduce solutions into the trade chain to address challenges, they must be workable solutions”, Mr Ofosu-Appiah stated. Read Full Story