Sunday, September 15, 2019

Trade Ministry Defends New Cement Tax Policy

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By Kebba Secka

Following a cabinet decision to protect local cement importers, Government has now resolved to increase the excise duty on cement to 5%, causing high cost and scarcity of cement in the country. In an interview with this reporter, the Permanent Secretary at the Ministry of Trade, Infrastructure and Regional Integration Mod K Ceesay, justified the cabinet decision saying it is a way of protecting and promoting local cement importers.

According to him, consideration was given to the fact that all importers need to be treated the same. But further stated that those importing from Europe, help Government financially in terms of conserving foreign exchange, create jobs and promote competition. Ceesay said the decision to support local industries will promote competitiveness and will give way to the total liberalization of the cement industry.

“We need to attract investment for us to get this. There are certain things Government needs to do,” said PS Ceesay.

Commenting on the scarcity of cement and the high cost, PS Ceesay said with Government coming up with such a decision, does not mean they are not monitoring the situation.

“This does not mean Government will not ensure the availability of the commodity for consumers. We have dispatched our officers in the field to monitor the situation,” he revealed. On the chances expected to be derived from supporting local cement importers from Europe, Ceesay said it will enable Companies graduate from being re-bagging cement producers to becoming manufacturers, and creating jobs for the youth among others. Asked whether Government will accept to reconsider its tax policy on cement if the situation remains to be problematic for consumers, PS Ceesay said Government can reconsider its decision. But added that this is why they urged both Salam and Jah Cement importers to put their house in order, by reviewing their plans and policies in order to ensure stability of the markets as well as the availability of cement. This he said, does not only stop at words but officers of his Ministry are in the field monitoring the situation.

It could be recalled that last year, a cabinet decision was reached to protect and promote local cement importers in order to boost local cement production in the country. On 14th November 2018, the Ministry of Finance gave a directive to GRA to enforce the decision effective 1st January 2019. On the 16th of November 2018, GRA started levying a 5% excise tax on cement. This did not go down well with importers getting cement from Senegal and builders. Information gathered from Farafenni indicate that a bag of cement costs between D305 to D310, whilst in the Greater Banjul, a bag of cement costs between D265 and D285 depending on the Company’s price. Before the new tax regulation, a bag of cement cost between D245 and D260.

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