'Fumigation tax on imported raw materials is extortion' - Labour expert

The Secretary General of the Ghana Federation of Labour (GFL), Abraham Koomson, has criticised the fumigation tax imposed on imported raw materials, describing it as “outright extortion” from businesses.

Speaking on Ahotor FM’s Yepe Ahunu programme, Koomson argued that dry bulk imports such as clinker and limestone, used in cement production, arrive tightly sealed and are not subjected to fumigation. Despite this, companies are required to pay the levy.

The fumigation tax is a charge collected at Ghana’s ports to cover disinfection and pest-control services on imported goods. It is intended to prevent harmful pests and contaminants from entering the country.

However, Koomson opines that the tax is being applied even when fumigation is not carried out, adding unnecessary costs to local production.

He warned that the levy increases the price of locally manufactured goods, making them less competitive.

“Companies are being compelled to pay for a service that is not rendered to them. Such nuisance taxes add extra costs to locally produced goods, making them more expensive and less competitive,” he said.

“We need an explanation as to why such taxes are imposed and whether the state genuinely benefits from the revenue generated,” he added.

The labour expert further cautioned that the policy could discourage investment and undermine government initiatives such as the 24-hour economy.

He called on government to review and eliminate taxes that unnecessarily burden local industries to create a more business-friendly environment.

SA