Zimra shuts down Chinese firm

Source: Zimra shuts down Chinese firm – NewsDay Zimbabwe June 16, 2017

THE Zimbabwe Revenue Authority (Zimra) has shut down a Chinese blanket manufacturing firm, Veleez, for circumventing their duty and tax obligations.

BY TATIRA ZWINOIRA

Chinese firms are reportedly dodging Zimra in paying duty by putting the wrong tariff codes, undervaluing goods, and understating the quantity of goods. Other tactics include not applying for import licences to bring in goods through the country’s borders.

Zimra officials visited Veleez which operates in the Southerton industrial area where they engaged a Mr Wang whom the workers from other businesses operating on the premises said was in charge of the company.

Wang then pretended not to speak English, although employees from other businesses operating at the premises had earlier told NewsDay he spoke and understood the language.

However, Wang’s actions baffled Zimra officials as he seemed to be busy on his phone the entire time before briefly talking to the tax collectors.

NewsDay witnessed the Zimra officials showing Wang a document believed to be the letter embargoing the blankets and closing Veleez operations before they left.

After the Zimra officials left, NewsDay approached Wang who then retreated into the factory, shutting the doors behind which he remained on his phone.

A source told NewsDay that Zimra first caught wind of Veleez’s tax evasion practices following a tip-off on Wednesday which involved the Chinese business putting wrong tariff codes leading the authority into investigating the business.

“They have a shop in town at the corner of Rezende and Bank [streets] and it was noted that they were selling blankets. As such, they were followed back to Southerton by the person who tipped-off Zimra, who spoke to some people and confirmed that the company makes blankets, bread and water, then Zimra was called,” the source said.

Veleez is believed to be the bottlers of Jojo purified water.

Statutory Instrument 19 of 2016 removed blankets from the open general import licence and requires importers to have permits to bring them in. These come with a tax code requiring importers to pay 40% of value imported, $2,50 per kilogramme and 15% value-added tax (VAT), which are measures to deter blanket imports.

Some Chinese companies reportedly issued receipts in Chinese and yuan without a Zimra registration number and VAT deductible.

The officials also pretended not to speak English whenever Zimra officers came to their offices.

Florence Jambwa, Zimra’s board secretary and director of legal and corporate services said the Revenue Authority Act [Chapter 23:11] precluded Zimra from divulging specific information pertaining to its clients to a third party.

“I am, therefore, unable to respond to the issues you have raised because of the secrecy provisions of the Revenue Authority Act,” Jambwa said.