Import Duties – NBC Institute

PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

Question

The Finance Minister of Ghana during the 2022 budget presentation in Parliament announced the withdrawal of the “Benchmark Value Discount” policy on some imports. The President of the Professional Local Rice Growers Association (PLRGA) is elated about the announcement and has invited you, as a student studying taxation, to explain the concept of the Benchmark Value Discount policy to him.

Required:
Explain what the “Benchmark Value Discount” policy in Custom Administration is and how its withdrawal will be of much benefit to the President of the PLRGA.

Answer

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Tags: Benchmark Value Discount, Customs Administration, Import Duties, Local Production
Level: Level 2

Topic: Value-Added Tax (VAT), Customs, and Excise Duties
Series: AUG 2022

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

Question

Obiba JK Enterprise imports component parts from China and assembles them into various forms of office equipment. On 1 January 2016, component parts were imported with the following details:

Item	Cost ($)
Cost of containers	2,200
Cost of packing for labor and materials	550
Cost of materials used in production	15,600
Cost of tools inserted in the components	3,750
Development and design costs	630
Royalties and licenses	330
Cost of labor and others in China	7,400
Shipping and transport to Tema Harbour	GH¢16,200
Loading, unloading, and handling charges	GH¢5,400
Cost of marine insurance	GH¢2,958.30
Assembling overhead cost	GH¢23,400
Fees for freight services to Tema Harbour	GH¢3,700

Additional Information:

Trade discount of 2% on the cost of goods (not yet accounted for).
Excise duty of $560 paid in China (included in the labor cost).
Contingent discounts and rebates of 1% (already accounted for).
Technical assistance of GH¢3,000 after the goods arrived at the factory.
Average exchange rate was $1 = GH¢3.11.
Import duty is 20%.

Required:
i) Compute the Cost, Insurance, and Freight (CIF), clearly showing workings of each component.

(9marks)

ii) Compute the VAT/NHIL. (1 mark)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Insurance and Freight (CIF), Import Duties, Tax computation, VAT/NHIL
Level: Level 3

Topic: International taxation
Series: NOV 2017

PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

Question

Required:
Explain what the “Benchmark Value Discount” policy in Custom Administration is and how its withdrawal will be of much benefit to the President of the PLRGA.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Benchmark Value Discount, Customs Administration, Import Duties, Local Production
Level: Level 2

Topic: Value-Added Tax (VAT), Customs, and Excise Duties
Series: AUG 2022

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

Question

Obiba JK Enterprise imports component parts from China and assembles them into various forms of office equipment. On 1 January 2016, component parts were imported with the following details:

Item	Cost ($)
Cost of containers	2,200
Cost of packing for labor and materials	550
Cost of materials used in production	15,600
Cost of tools inserted in the components	3,750
Development and design costs	630
Royalties and licenses	330
Cost of labor and others in China	7,400
Shipping and transport to Tema Harbour	GH¢16,200
Loading, unloading, and handling charges	GH¢5,400
Cost of marine insurance	GH¢2,958.30
Assembling overhead cost	GH¢23,400
Fees for freight services to Tema Harbour	GH¢3,700

Additional Information:

Trade discount of 2% on the cost of goods (not yet accounted for).
Excise duty of $560 paid in China (included in the labor cost).
Contingent discounts and rebates of 1% (already accounted for).
Technical assistance of GH¢3,000 after the goods arrived at the factory.
Average exchange rate was $1 = GH¢3.11.
Import duty is 20%.

Required:
i) Compute the Cost, Insurance, and Freight (CIF), clearly showing workings of each component.

(9marks)

ii) Compute the VAT/NHIL. (1 mark)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Insurance and Freight (CIF), Import Duties, Tax computation, VAT/NHIL
Level: Level 3

Topic: International taxation
Series: NOV 2017

Question Tag: Import Duties

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PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

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Question Tag: Import Duties

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PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

You're reporting an error for "PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties"

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

You're reporting an error for "AT – Nov 2017 – L3 – Q4b – International taxation"

PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties

Explain the "Benchmark Value Discount" policy in Customs Administration and how its withdrawal benefits local rice producers.

You're reporting an error for "PT – Aug 2022 – L2 – Q1a – Value-Added Tax (VAT), Customs, and Excise Duties"

AT – Nov 2017 – L3 – Q4b – International taxation

Calculating the CIF and VAT/NHIL for imported goods.

You're reporting an error for "AT – Nov 2017 – L3 – Q4b – International taxation"

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