1)
The duty drawback scheme is a regime put in place by the GRA to refund of import duties and taxes paid on imported materials that are used as input in the manufacture of goods which are subsequently exported.

The drawback duty should normally be refunded when
a. Goods are imported and subsequently exported in the same condition when the goods were imported,
b. Imported goods that are used for the manufacture of goods in the country and are subsequently exported.

Ideally, a company does not necessarily have to be the importer of the goods in order to claim the duty drawback.

Once there is sufficient evidence or proof that imported inputs are used in the manufacture of goods for export, the applicant is entitled to a drawback.

Again where a person proves to the satisfaction of the CG that goods after having been placed on board a conveyance (ship, plane, vehicle) for exportation, have been destroyed by accident on board, the CG shall pay the drawback payable on the goods in the same manner as if the goods had been actually exported.

Goods are deemed to be exported for drawback purposes where the goods are:-
a) Sent to a free zone area or duty free shop;
b) Exported;
c) Designated as stores in accordance with the Custom’s Act, Act 891 and supplied for use on board a ship or aircraft outside our customs territory;
d) Used for equipment repair or construction of a ship or an aircraft prescribed by regulation; or,
e) Used or designated for use in a manner prescribed by the CG.

4. Operation
   It is important to note that, the rational for the drawback is to enhance the competitiveness of a country’s manufactured products. It enables domestic manufacturers to compete in foreign markets without the handicap of including in their costs, and consequently in their sales price, the duty paid on imported input.

A very large portion of the material base of goods manufactured here in Ghana may have been imported from outside of Ghana for processing in Ghana. On arrival of these raw, semi or fully processed inputs at the Ghana ports, duties and taxes are paid as prescribed by the tax laws.

The importer obviously pays the excise and/or port duties/taxes levied on the goods to the GRACustoms. We should note that the excise/port duty or tax paid by the importer is expected to be passed on as part of the production cost of the importer/manufacturer to the consumer of the product, to pay. Therefore the consumer indirectly pays for port duties/taxes even though the consumer had no hand in the delivery process of the goods at the port.

If the consumer lives in a foreign country, Country B, the export of this product will include the duties and taxes paid at the port and this could make the price of the Ghana product higher due to the earlier import duty and taxes paid at the Ghana port. The importer in the importing country B will also pay port duties in his home country for importing those products from Ghana. In that case, the price of the product in Country B will include two obvious taxes. These are the Ghana port duties and taxes paid when the raw/semi or fully processed materials came to Ghana and duties that will be paid by the importer in his home country, Country B, where the goods have been exported to, from Ghana. This of course will make Ghana’s products more expensive than what prevails in the export destination country if imports from other competing countries do not carry those taxes like they do for the Ghana products.

To make the Ghana product less expensive or equal in price to products from other countries, and to strengthen trading with the outside world in general, that part of the duties and taxes paid when the raw/semi or fully processed inputs came to Ghana will have to be relieved to make Ghana products in the destination country very competitive with like goods manufactured in or imported into that country

5. Advantages:
   a) Huge sums of money borrowed and interest payment that would be tied up in the drawback regime released by the scheme.
   b) Make local exports cheaper/competitive since export price will no more carry taxes/duties paid on imports.
   c) Creates strong confidence in local business to boost and export more of products manufactured locally.
   d) Increased foreign trade increases the counties foreign exchange reserves and improves trade with the outside world.
   e) Lower costs of production occasioned by the recovery of the duty acts as an incentive to encourage exports of processed goods.