GRA to intensify usage of excise tax stamp

The Ghana Revenue Authority (GRA) has announced the Authority’s intention to intensify usage of its newly introduced excise tax stamp to regulate the production, promotion and sales of goods in the country.

Mr Kwabena Apau, Head of the Excise Unit of the GRA said by legislative instrument, the Government will determine the date from which manufacturers and importers are to affix the stamps on the specified products very soon.

He said a manufacturer, importer, wholesaler, or retailers with old stock of specified products unsold after the transitional period shall be required to purchase the stamps for their products.

The step was announced at a stakeholder seminar in Accra, to make the intentions of the Authority known in the strengthening and monitoring as well as the evaluation of the quantity of products manufactured by companies to ensure the right payment of taxes.

Mr Apau, making a presentation on the initiative, said the Excise Tax Stamps are to be fixed on goods manufactured in the country and delivered for home consumption as well as goods imported into the country.

He mentioned mineral water, bottled and other packaged water, carbonated soft drinks, malt drink, stout, beer including cider beer, wines including sparkling wine, spirits, cigarettes and other tobacco products as the specific products affected by the initiative. It however excludes sachet water.

“All products in the affected categories found without excise tax stamp affixed on them beyond the transition period or affixed with fake, counterfeited or altered stamps shall be seized as prescribed in Sections 124 and 125 of the Customs Act, 2015 (Act 891)”, he said.

Mr Appau said 32.5 per cent of excise is paid by manufacturers on products if raw materials used for production in the beverage industry are highly foreign, however, manufacturers are entitled to pay only 10 per cent if the raw materials used are locally produced, adding that, the step is to encourage usage of local raw materials.

He said bottled potable water attracts excise duty of 17.5 per cent; alcoholic beverages like whisky and brandy attracts an excise duty of 25 per cent; whisky and brandy attract 25 per cent; wine attracts 22.5 per cent; and cigarette and other tobacco products attract 175 per cent.

He said the reason for high tax on cigarettes and tobacco products was to discourage production and importation of tobacco products into the country.

He noted that taxes are paid only at the manufacturing point and the entry point, explaining that local manufacturers file returns on production and sales of their products by the 21st of every month for the Authority to compute them and demand payment based on the amount of production and sales.

The Head of the Excise Unit said considerable revenue has been lost through illicit trade over the years and illegal operators within Ghana smuggle tobacco, spirits, and other alcoholic beverages into the country, stressing that, illegal operators indulge in the sales of counterfeited products.

“Even with our tracking devices, people still manage to offload products at some parts of the country to avoid payment of taxes, and move empty cars to Accra. So one may think products in Kumasi or other places are cheaper than in Accra and it is because the manufacturers don’t pay taxes on them”.

He said the tax stamps are product specific stamps with features including multiple overt and covert security; and the Authority has devices to detect its authenticity.

Mr Appau said the original stamp must not fade for at least one year under the sun; must be water fast and scuff resistant; must not be reusable; and must be self-adhesive-permanent on even and uneven surfaces.

Mrs Vivian Adusei, Deputy Commissioner of Small Taxpayer Offices and Chairperson for the Seminar in her welcoming address said the seminar would allow the Authority to detect customs and domestic issues of importance with its stakeholders.

She commended the Authority for organising the seminar to control wrong doings in the manufacturing and importation of goods into the country.

Source: GNA