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Intra- African Trade ECOWAS tax on timber will collapse industry--MP

Parliament on Thursday, December 17, 2015, passed the Customs Amendment Act, 2015, Act 891, to insert the ECOWAS harmonized system of imposing taxes on imported timber into the country.

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A decision by ECOWAS to impose tax on imported timber on member states including Ghana will hurt the timber industry, New Patriotic Party Member of Parliament (MP) for Atwima-Nwabiagya North, Benito Owusu-Bio, has said.

Parliament on Thursday, December 17, 2015, passed the Customs Amendment Act, 2015, Act 891, to insert the ECOWAS harmonized system of imposing taxes on imported timber into the country.

However, according to the MP, Ghana's timber industry has a unique challenge different from those that exist in other member states, adding the decision to impose taxes on imported timber will further hurt the local industry.

In an interview with Kasapafmonline.com to shed light on the challenges facing the timber industry, Mr. Bio said: “I have decided that we stop it now and look at certain sections (Section 1) of the Bill because – the heading is to deal with wood and wood articles. Under schedule 44.02 to 44.044 we have tariffs for the importation of solid wood in terms of round logs and wood that can be used for raw materials for our timber industry.”

“Over here, we have 10% for import duty and 15% for VAT. When you add them together, you will get 25%. We in Ghana, currently we are all aware of the collapse of the timber industry. The timber industry, especially, the sawmill aspect of it is virtually collapsing and it is collapsing not through the doing of the managers of the firms but rather due to the fact that the raw materials currently are not available. Even if they are available, what is there is not enough,” he noted. But his plea was ignored with the House going ahead to pass the Bill.

Mr. Owusu-Bio's attempt to block the bill proved futile. House leader Alban Sumana Kingsford Bagbin, commenting on the matter told Members that the issues raised by Mr. Owusu-Bio could not be addressed by the House since ECOWAS as a sub-regional bloc had already agreed in principle to impose the taxes on imported timber.

Moments after the passage of the Bill into an Act, he appealed to the government to stop the imposition of tariff on the importation of timber into the country.

"What is wrong with asking the government to go back to the ECOWAS Community and have a discussion with them if there are issues with the treaty? As we speak, most of the countries in the ECOWAS region do not have problems with the treaty because if you talk about Liberia, they never cut their wood like we did so they still have the wood.”

He said because of lack raw materials (timber), most of the sawmill firms, especially, in Kumasi and other parts of the country, are folding up.

He believes that once they stop the tariffs on the importation of timber into the country, wood products will be cheaper and industry will open up and employ more of the teeming youth who are unemployed.

“Why don’t we help the Ghanaian industry for them to get the raw materials and impress on them to produce the furniture that we want? It can even lead to the ban in the importation of furniture from outside Ghana. This is a policy issue and I don’t understand why Parliament will not help us to do this.”

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