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General News of Tuesday, 27 January 2009

Source: Daily Graphic

Ghana@50: No trace of 139 vehicles - CEPS

...Mode of disposal of the vehicles questionable
One hundred and thirty nine vehicles imported for the office of the President by five motor firms in the country cannot be located by the Customs, Excise and Preventive Service (CEPS).

CEPS has also described the mode of disposal of the vehicles as questionable, as no records on them can be traced.

Furthermore, the motor firms involved in the transaction have refused to respond to queries that will enable CEPS to draw some conclusions on the matter.

The 139 saloon and 4x4 vehicles were imported on behalf of the Office of the President by Svani Limited, Mechanical Company Ltd, Universal Motors, Fairllop International Lid and PHC Motors Limited.

Details of the transactions were contained in a letter signed by the Commissioner of CEPS, Mr. E.N. Doku, to the chairman of the Assets Transfer Subcommittee of the government’s transition team.

It noted that “these companies were selected for a closer look because of the interest shown by honourable committee on the mode of importation and disposal of the vehicle which were originally imported for the Office of the President but were subsequently sold to individuals".

Giving a breakdown of its finding in the letter dated January 19, 2009, the CEPS commissioner noted that 968 vehicles were imported by the Office of the President between 2003 and 2008 with the value of tax forgone on the said vehicles amounting to GH¢7,892,935.67.

It explained that imports made on behalf of and for the Office of the President were tax exempt.

On PHC Motors Ltd, CEPS indicated that its current records and enquiries did not disclose the current location or mode of disposal of the 35 Chrysler vehicles imported for the Office of the President. It said Fairllop International Ltd imported 40 Jaguar X-Type, 40 Rover 75, two Rover 75V6 and one Rover 45 for the Office of the President.

Out of the number, Fairllop bought back 35 Jaguar X-Type, while CEPS' enquiries did not disclose the location and mode of disposal of the remaining five Jaguar X-Type and 43 Rovers.

With regard to Mechanical Lloyd, CEPS said the company imported 50 BMW 730 LI, two Land Rover Discovery, two BMW 745 Li high security, 13 Ford Ranger pick-ups and one Ford Explorer.

It said the company bought back 40 of the BMW 730 Ll and sold them to its customers under a specific sale arrangement.

It said CEPS' "current records and enquiries did not disclose the location or mode of disposal of two Land Rovers, 10 BMW 730 Li; two BMW Li 745, 13 Ford Ranger pick-ups and one Ford Ranger".

The letter noted that Universal Motors imported 36 VW Passat (Comfort Line) for the Office of the President and subsequently released 35 of the vehicles to the custody of the Ghana@50 Secretariat.

It said although records indicated that certain individuals were allocated some of the vehicles, "our records and enquiries did not disclose the current location or mode of disposal of 28 of the vehicles".

Sources close to the committee and CEPS told the Daily Graphic that the mode of sale to the importing firms had not been proper because there had been no public bidding process.

They wondered why the government would sell the vehicles back to the importers after paying 50 per cent of their total cost.

The sources said what made the transaction worse was the fact that the sourced companies gave a 40 per cent discount after the government had made a 50 per cent up front payment.

They cited the case of the Jaguars, claiming that the government bought each for $36,000, although it was being sold for $23,000.

According to them, even if the government was to resell the vehicles, it should have been done by a public bidding process or auction but that was not done.

"It was a letter from the Chief Director at the Office of the President who, for instance, in a letter to the Driver and Vehicle Licensing Authority (DVLA), asked that the vehicles be registered in the name of Mechanical Lloyd Company Ltd, which it claimed the company purchased the vehicles through a public bidding process," they said.

The sources challenged the former Chief of Staff and the Chief Director to provide evidence of the public bidding process.

Moreover, they said CEPS and the state valuer should have been part of the process to revalue the cars and also calculate the appropriate duties on them for the buyers to pay accordingly.

They explained that under the CEPS Law, although items bought for the Office of the President and the Diplomatic Corps were tax exempt, anytime they were to change hands into private hands the new owner was made to pay the appropriate taxes.

The sources said it was important that these facts were put out for Ghanaians to appreciate the anomalies in the transactions.