Business News of 2014-06-26

Fruit juice importers milk the nation of millions

Government is losing millions of cedis of import duty revenue in what appears to be undervaluation of specific brands of imported fruit juice.

This alleged illegal act has made imported fruit juices cheaper than locally produced ones, threatening the survival of local fruit processing firms.

For example, a company distributing one popular brand of fruit juice declares import Free On Board (FOB) at $4.06 per carton, instead of the actual FOB of $11.52.

So far, four major fruit juice importing companies (names withheld) are said to be involved in this alleged undervaluation, and the Presidential Revenue Mobilisation Taskforce would have to look into the matter.

For example, one company is said to be importing over 20,000 cartons of fruit juice per month on the average, with each carton containing 12 packs, and each pack weighs one litre.

This translates into not less than 100,000 cartons of fruit juice imported between January and May this year, which works out to give a profit of about $752,000 for the importer.

Even though the agreement on customs valuation recommends the use of actual price payable subject to specific adjustments, information available to The Finder points to serious issues on the declared values of imported fruit juice purported to be the actual price.

An analysis of the difference in the declared invoiced prices of some particular fruit juices compared to other fruit juices of equal quality raises serious valuation issues.

Consequently, the distributor and wholesale prices of the said fruit juice brands give credence to alleged manipulation and possible collusion between importers, suppliers and customs officials.

What is baffling is that even though Customs took some measures mid-2013 to correct the disparity, for unexplained reasons, the values being paid now are even lower than before.

Source: The Finder
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