Zimra incapacitated to stop smuggling — Industry

INDUSTRY has raised concern over the Zimbabwe Revenue Authority’s (Zimra) capacity to stamp out smuggling at ports of entry, amid claims its officials were incapacitated to deal with of duty and rules of origin issues.

Source: Zimra incapacitated to stop smuggling — Industry – NewsDay Zimbabwe October 14, 2016

BY MTHANDAZO NYONI

This came out at a Confederation of Zimbabwe Industries (CZI) roundtable briefing on business and economic matters in Bulawayo on Wednesday.

First to raise the issue was the Zimbabwe Textile Manufacturers’ Association vice-president, Freedom Dube, who said smugglers were declaring blankets as woven fabric to avoid paying duty, something Zimra officials were failing to detect.

Dube said they had tried several times to engage Zimra over the issue, but with no luck.

“We tried to second some of our people to the borders to assist in identifying those products, to no avail,” he said.

Chinese businesspersons are reportedly repackaging and selling blankets, which they claim to have been manufactured locally, when in fact they come into the country as finished products.

The blankets are being fraudulently declared as woven long pile fabric, which attracts a duty of only 10%.

Through Statutory Instrument 19 of 2016, government prohibited the importation of blankets, second-hand clothes and shoes without import licences.

However, smugglers are declaring the blankets as woven fabric to avoid paying duty, while maximising on profits.
Blankets attract a duty of 40% and an additional $2,50 per kg.

CZI president, Busisa Moyo said they were seized with the issue and he would write to the Zimra commissioner-general articulating industry’s concerns.

“I will be writing to the Zimra commissioner-general on the issue of smuggling,” he said, adding they want to engage the army and police also.

Zimra was also grilled for failing to administer the rules of origin, which are laws, regulations and administrative rulings applied by the government to determine the origin or source of imported goods.

This, industry said, has resulted in the abuse of Sadc and Comesa trading certificates by countries outside the region.

Zimra is supposed assess whether a shipment qualifies for a tariff preference or falls within a quota limitation as defined in regional trade arrangements.

But due to its incapacity, both institutionally and resourcefully, Zimra has been found wanting, as goods such as cooking oil and clothes, among others find their way into the country.

Imports are blamed for suffocating local manufacturers forcing the government to place restrictions on imports.
Experts say the restrictions kill the competition from imports, which would ultimately lead to low prices.