Vehicles are a vital mode of transportation and play a crucial role in a country's economy. In this context, cars are fundamental to economic progress as they create jobs and generate income.

Factors such as import tariffs, shipping costs, vehicle sales, and the employment of mechanics and retailers of gasoline, oil, and other automotive products contribute significantly to revenue.

Additionally, motor vehicles support road construction and maintenance jobs, commercial driving, and car washes. Ultimately, they enhance economic activity and can even save lives.

However, despite these advantages, motor cars are often regarded as a luxury in Ghana's pursuit of development. This classification places car owners in higher tax brackets, creating an additional financial burden.

Many importers, potential purchasers, and owners face issues regarding car imports, vehicle types, and ownership costs. One of the grounds for the luxury categorization of motor cars is the vehicle's high cost, which makes it pricey.

Others argue that Ghanaians' low incomes, high dollar exchange, and inflation rates are contributing factors. Furthermore, others say that our processes and procedures, expensive importation costs, high car and maintenance costs, road conditions, and traffic are among the barriers stopping Ghanaians from reaping the advantages of vehicle ownership. However, majority of Ghanaians attribute high cost of vehicles in in Ghana to higher tariffs.

The effects of higher import tariffs on imported vehicles

Import tariffs at Ghana's ports safeguard indigenous industries and produce government income. Still, the levies, particularly on imported vehicles, have unforeseen and negative consequences for companies, consumers, and the overall economy.

They raise the cost for importers, possibly resulting in higher consumer prices since importers would have to spend more to get used automobiles into the nation. They will likely pass these additional costs to consumers through higher car prices, rendering them less affordable.

It diminishes demand, perhaps prompting importers to change their business strategies or leave the market. Importers may have to change their business strategy, reduce their activities, or abandon the market entirely. Higher tariffs on automobiles cause a downturn in the car import business. Job losses occur in allied industries such as transportation, warehousing, and sales.

Ghana has a significant population of people of driving age, with a score of 62.9 out of 100, which increases the demand for vehicles. However, poverty and high import taxes, make importing vehicles into Ghana a challenge due to the numerous taxes involved.

Importers of a single automobile must pay up to 21 different taxes. Among these 21 taxes are Import Duty, Import VAT, Processing Fees, and the ECOWAS Levy.

Additionally, importers are subject to upfront payments for Unregistered VAT, Vehicle certification Fees, Vehicle Examination Fees, Network Charges, and COVID-19 Health Fees.

Moreover, there are several other taxes that contribute to this burden, including:
- Ghana Shippers Authority SNF
- Import NHIL
- Withholding Tax on Import
- GHS Disinfection Fee
- MoTie IDF Fee
- Special Import Levy
- Ghana Export-Import Bank (EXIM) Levy
- Ghana Education Trust (GET) Fund Import Tax
- African Union Import Levy
- COVID-19 Health Recovery Levy

A closer examination of these taxes reveals that VAT is charged multiple times, as are other contentious fees like the "Network Charge NIHL." Despite being in 2025, almost five years after the COVID-19 pandemic, importers are still subjected to double taxation for COVID-19-related fees on a single vehicle.

They also face both a "Network Charge" and "Network Charge VAT."
Importers question why automobile taxes are duplicated and feel that this constitutes daylight robbery.

While many aspire to drive a new automobile, the financial means are often unavailable. The country's average income is modest, and only a small percentage of high-income individuals can secure vehicle loans.

These factors contribute to a decreased demand for expensive, brand-new cars and the cry over too much taxes imposed on clearing a car at the harbor.

The advantages in reducing taxes on Imported Vehicles

Nevertheless, there are several advantages to many residents owning their own vehicles. I urge the government to consider the following: In today's economy, many people and families are looking for ways to save money while maintaining quality because most household income is not enough but need a vehicle so they will prefer to purchase a used automobile.

Purchasing a used car offers incredible advantages, especially when saving money. Many pre-owned vehicles have features and performance similar to their newer counterparts but come at significantly lower prices.

This affordability allows budget-conscious buyers to consider higher-quality models or additional features that may have been out of reach with a new car.

It is also essential to understand the impact of vehicle depreciation on pricing. Did you know that a new car can lose up to 20% of its value in the first year? This rapid depreciation means new vehicles can be costly, as buyers effectively pay a premium for something quickly losing value.
In contrast, choosing a used car allows one to benefit from the fact that much of that depreciation has already occurred. This means one can enjoy a reliable vehicle without the steep price tag. Therefore, used cars are a fantastic option for anyone looking to make smart financial decisions while still driving a great vehicle.
Lower taxes on cars, especially, used automobiles in Ghana could improve affordability, encouraging economic activity and mobility, particularly for lower-income individuals and businesses.
Reducing taxes on used cars makes them more accessible to a more significant segment of the population, especially those with limited incomes. This increased affordability can lead to heightened economic activity and mobility.
More car ownership could also benefit related industries such as auto maintenance, fuel sales, and insurance, contributing to economic growth.

Lower taxes on automobiles may also enhance mobility and facilitate commerce, create jobs, and increase access to essential services, leading to economic and social benefits.

Reducing automobile import tariffs, in general, may help decrease dependency on public transportation. More car ownership will put less burden on public transportation systems, resulting in less congestion and greater efficiency.

In the case of used cars, consumers are attracted to them due to certain factors and one of them is depreciation. A new car's value might drop by up to 20% in the first year of ownership. This fast depreciation makes purchasing a new automobile more expensive, as consumers pay a premium for a vehicle that rapidly loses value.

In contrast, buying a used automobile implies that the majority of the depreciation has already happened, enabling consumers to get a dependable vehicle at a lower price. This makes secondhand vehicles an attractive choice for customers on a limited budget.

In addressing the issue of used cars in Ghana, I want the authorities to understand that high import duties or import penalties on used vehicles only serve as a regulatory barrier. They frequently fail to address the conditions that makes it difficult for people to own cars.

The desire to own a car through any means drives demand and supply to the black market. Importers, often working with corrupt customs officials, frequently manipulate the details of used vehicles and declare false information to avoid bans and penalties.

Governments have cited higher tariffs on used cars in Ghana due to outdated technology, high emissions, and an increased risk of accidents. However, the government should be aware that higher tariffs on imported used cars in Ghana are intended to boost local automotive production and reduce reliance on imports, increase consumer costs, and may impact the Ghanaian economy, particularly for businesses that rely on vehicles.

The companies that have established vehicle assembly plants in Ghana are primarily owned by foreign entities, and they sell expensive cars that most Ghanaians cannot afford.

In light of the above submission, it would be ideal for the government to revise import duties. This change would enable average Ghanaian workers to drive their cars without straining their finances. Such an adjustment would not only benefit individuals but also strengthen the thriving used car industry, which supports numerous jobs, from dealers to mechanics and beyond.

By nurturing this vital sector, the government can fulfill its commitment to protect businesses and contribute to a more prosperous future for all Ghanaians.