PRESS CONFERENCE ISSUED BY THE GHANA UNION OF TRADERS’

ASSOCIATIONS (GUTA) ON THE 50% REDUCTION OF THE BENCHMARK

VALUE POLICY HELD ON MONDAY, 15TH NOVEMBER, 2021.
Members of the Press, Distinguished Ladies and Gentlemen.
We find it very necessary to invite the media here this morning to state our position on the 50%
reduction of the benchmark value policy of the government, which was introduced in 2019 to
save businesses from total collapse and wish to strongly caution against its review; as some
lobbyists are seeking.
Ladies and Gentlemen, we want the world to know and understand that the 50% benchmark
value reduction did not come out of the blue. For years, businesses in the country have been
crying over high rate of import duties, other taxes, fees and charges which were ruining
businesses in the country. GUTA, ASSOCIATION OF GHANA INDUSTRIES (AGI),
GHANA NATIONAL CHAMBER OF COMMERCE AND INDUSTRY (GNCCI) and others,
have all been complaining bitterly about high cost of doing business in the country, which in
effect have become very unbearable. For the importing community, duty payments, Value
Added Tax (VAT) and other port fees and charges cumulating to about 55% and 65% of the
invoice values for products with import duty rates of 20% and 35% respectively.
After persistent agitations by members of the business community, the government heeded, but
was challenged in reducing the duty rate due to the ECOWAS Common External Tariff. The
government then decided to discount these invoice values that were to be guided by the GRA-
Customs own benchmark values. This is what has become or termed to be known as the 50%
reduction of the benchmark value policy.
This innovative and good policy has since its introduction been enjoyed by all sectors of the
business community including the AGI, who imports over 90% of their manufacturing inputs
into the country. Since then, the government has been exceeding its revenue targets. The lesson
here is that when taxes are affordable it raises level of compliance, which goes a long way to
minimize smuggling and other corruptible practices.
It is worthy to state herein that against all odds, the benchmark value was a mitigating factor
during the outbreak of the COVID-19 pandemic in 2020 and beyond. In spite of the adverse
effects of the pandemic where global commodity prices have gone up astronomically with
extremely high freight charges, businesses have been able to contain and sustain prices as a
result of this innovative policy of benchmark value, without which prices of goods would have
skyrocketed to an unbearable limit.
With the advantage of this appropriate and sound policy of the government that has helped all
and sundry, it is, therefore, very surprising to hear that AGI is lobbying the government with
malicious lies, self-centeredness, egoism, elitism and an outright show of arrogance seeking the
help of the government to suppress other key players in the private sector.
We should be very much surprised if the government succumbs to this treacherous and diabolic
request of the AGI who are trying to lobby against this most acceptable flagship policy of the
government to destroy the distribution sector of the economy.
Ladies and Gentlemen, the irony, hypocrisy and absurdity here is that, whiles the AGI is calling
for the abolishment of the 50% reduction of the benchmark value policy for the trading
community, they are on the other hand crying to and pleading with the government to maintain

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the same 50% benchmark value reduction for their imports. Members of the Press, you can
clearly see the double standards here.
In effect what the AGI is telling the government is that, their goods are very expensive as
compared to that of their competitors in the other parts of the world, and that the government
should surcharge the people of Ghana with high import duties to bridge their extortionist prices
which have come about as a result of their own inefficiencies and total lack of understanding of
modern technology in manufacturing.
We hereby want the whole world to know that we support local manufacturing companies and
we distribute their products. The plain truth here is that there are some of the local manufacturing
companies that are doing well and are highly competitive in terms of quality and pricing; to the
extent that Ghanaian importers do not even venture to import their kind of products into the
country. This is what we need as a people and a country which GUTA is talking about and
expect all local manufacturers to research, know and understand where they have comparative
advantage in order to be able to attract patronage from local and international buyers. May we
seize this opportunity to commend the local pharmaceutical industries and others for their
ingenuity, hard work and insight.
It is very unfortunate that AGI does not know, understand and appreciate the real factors
militating against their inability to compete with their counterparts elsewhere on the globe. If
they really know this, then, they have failed to tell the government the truth that the high cost
of their products is not the importers who purchase their goods abroad or elsewhere, pay freight,
cost and insurance, duties and other overhead costs to come and show up the difference in
demand of the consuming public in Ghana.
We strongly believe that they know very well that the high cost of utility, high interest rate on
borrowing, high taxes, coupled with their own inefficiencies are the bane of their stagnation as
an industry. Whiles the rest of the world is using modern state of the art technology to enhance
production, AGI still fails to seek the necessary resources to enhance their production but stick
to the obsolete method of production, which is adversely affecting them and making them very
uncompetitive in global business.
Members of the Press, it is important to note that AGI do not benchmark their price inequalities
with the Free On Board (FOB) price of their counterparts abroad, where they woefully fall short
of about 60% in terms of price and advantage and find the appropriate mechanisms of addressing
those challenges.
All business people the world over do not merely buy goods because they are just made in their
home countries but consider pricing, quality and good packaging at that. As patriotic citizens of
Ghana, we will always consider buying locally manufactured goods if the price differentials are
negligible and not at abnormal and extortive price.
Ladies and Gentlemen, with regard to food imports like rice, oil, chicken and others, until Ghana
reaches food sufficiency, we should manage imports side by side with local production in order
not to punish the poor, the vulnerable and the low-income earner, especially in the midst of the
COVID-19 pandemic when people need food to energize them against the disease.
It is important therefore to remind the government of the immense support and concessions that
have been given to the local industries which has given the local manufacturers a leverage of
over 40% against the trading sector. It is, indeed, very surprising that the local industries cannot
appropriately utilize the advantage for themselves, as well as to the benefit of the consuming
public.
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It is an undeniable fact that no economy can thrive without a vibrant trading sector, therefore
any attempt to suppress this important sector of the economy will not only be inimical but will
also be suicidal for the state and people of Ghana. It will be very pathetic, insensitive and
discriminatory for the government to heed to the incongruous demands of these callous elements
in the private sector, to cause the reversal of the 50% reduction of the benchmark value to suit
their whims, especially in this era when businesses are in serious distress.
We wish to state herein that, it has come to our notice that the Ghana Revenue Authority (GRA)
has issued statement informing the public that the 50% benchmark value reduction policy has
been reversed; effective today, Monday 15th November 2021.
We hereby tell members of the trading community that we are not in the known of who
authorized the directive, as we have been told by the Economic Management Team (EMT) that
there will be a thorough stakeholder consultation before any decision is taken on that policy.
This was also reiterated by the Senior Minister, Hon. Yaw Osafo-Maafo in the last Presidential
Business Dialogue held at the Kempinski Hotel, Accra.
We of the trading community DO NOT ACCEPT and WILL NOT ACCEPT this directive
and therefore ask members of the trading community to ignore this statement of GRA outright.
However, GUTA’s door is still open to the government’s quest for stakeholder engagement on
the matter.
Besides that, we want to make it clear that businesses are under serious distress due to the global
effect of the COVID-19 pandemic, which has caused world commodity and freight charges to
shoot up to very abnormal levels. It is also important to note that in the mid-year budget
statement presented to the Parliament this year, 2021, the government also introduced some new
taxes. Fees and charges at the port have also been increased whiles shipping lines are also doing
their own thing by charging unreasonable fees, some of which are not even legitimate and need
to be addressed immediately; not to even mention the deleterious effect of the exchange rate.
The combination of all these factors make cost of doing business in the country extremely
unbearable and rapidly collapsing businesses, as well as exacerbating the plight of the Ghanaian
consumer.
We know fully well that the government is very sensitive to the plights of the Ghanaian trader
and the Ghanaian consumer as well. Over burdening them with another layer of cost will be an
indictment on the government, so we will appeal to the government to, as a matter of urgency
call for the immediate withdrawal of the statement issued by the GRA on the review of the 50%
and 30% reduction of the benchmark value policy and not even consider bringing it into the
forthcoming budget statement, to forestall the mounting agitations in the trading sector as the
business atmosphere is now full of tension.
Meanwhile, we will appeal to members of the trading community, especially importers, to calm
down, and not to pay any additional amount on duty for clearance, as we await response of the
government on this serious matter of concern.
Distinguished Ladies and Gentlemen, it is our hope and belief that the government will listen to
our genuine grievances with good ears and act decisively to avoid any unpleasant situation.

Thank you for your attention.

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