The Customs (Amendment) Bill, 2017 has been passed by Parliament to provide for a zero rate of duty payable on specific imported vehicular parts.
The Bill amends the Customs Act, (Act 891) to reduce the cost of supplies of specified vehicle spare parts in order to provide relief to consumers. It is expected to be presented to the President Nana Akufo-Addo for assent, which will pave way for it to take effect.
It is worth recalling that in the 2017 Budget Statement and Economic Policy, government proposed to reduce or abolish some taxes to stimulate growth in certain sectors of the economy, hence the amendment of the Act.
Appearing before the Finance Committee of Parliament prior to the passage of the Bill, the Deputy Minister for Finance, Kwaku Kwarteng informed the Committee that government held consultations with spare parts dealers upon which all the necessary spare parts were identified for inclusion in the zero-rating. He was optimistic that the Bill captures virtually all commonly used vehicle spare parts.
Presenting the Report of the Finance Committee, the Chairman of the Committee, Mark Assibey-Yeboah (Dr.), told Parliament that the Committee noted that the removal of the taxes affect both new and used parts and therefore importers and consumers of both new and used spare parts would benefit from the removal of the taxes.
As to how much revenue would be lost as a result of the passage of the Bill, the Committee was informed that the amount realised from the taxes on the specified vehicle spare parts for the first, second, third and fourth quarters of 2016 were GH¢23,876,000; GH¢32,678,443; GH¢21,400,000; GH¢19,547,000 Cedis respectively, thus a total of GH¢97,501,443 for the year 2016.