Government is set to ban importation of second-hand vehicles with passage of the Customs (Amendment) Bill 2020.
Parliament took the second reading of the Bill on Tuesday 3rd March 2020 and effectively pushing it to the consideration stage.
The Customs (Amendment) Bill 2020 will amend the Customs Act, 2015 (Act 891) and seeks to provide incentives for automotive manufacturers and assemblers registered under the Ghana Automotive Manufacturing Development Programme (GAMDP).
The Bill will, however, prohibit the importation of salvaged motor vehicles and specified motor vehicles over ten years of age into the country and also increase import duty on specific motor vehicles.
However, as part of the provisions of the Bill, the government will include the security agencies and their officers as part of institutions and persons granted exemptions on import.
This is to ensure critical imported equipment and accoutrement of the security agencies are not held up at the ports for long periods.
The Bill has been determined to be of urgent nature, and may, therefore, be taken through all the stages of the passage in a day in accordance with Clause 13 of Article 106 of the 1992 Constitution and Order 119 of the Standing Orders of Parliament.
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The GAMDP was launched in August 2019 to promote the manufacture of automobiles in Ghana for both the domestic market and the West African sub-region.
The programme is part of efforts by the government to develop strategic anchor industries to promote economic development in the country.
A joint Committee of Finance and Trade, Industry and Tourism, which considered the Bill and submitted a report, observed that it forms part of broad incentives contained in the Ghana Automotive Development Policy (GADP), which has been approved by Cabinet.
The report indicated that the Bill would lead to an estimated revenue loss of GH¢802,251,785.00 for the first three years.
This is, however, expected to be partially offset by the additional revenue from customs duties on vehicles not covered by the programme.
Passage of the bill will also lead to importation ban of specified motor vehicles over ten years of age, including a ban on the importation of salvaged vehicles regardless of age, type or description.
The Report indicated that vehicle manufacturers or assemblers registered under the GAMDP will be permitted to import Fully Built Units (FBUs) of vehicles into the country at a rebate of Customs Duty.
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This is to enable them to attain certain critical volumes to make their investments worthwhile, especially at the early stages of the industry.
The rebate policy is, however, renewable after every three years of the GAMDP.
The Ministry of Trade and Industry, according to the Committee report, is in advance discussion with the interested manufacturers and the indicative time of commencement of actual operation for Volkswagen, Toyota, Suzuki and Nissan span between the first quarter of 2020 to the end of the year.
Discussions are, however, ongoing with Renault, Kia and Hyundia as to when their operations will begin.
