Ncube makes u-turn on cellphone levy

Source: Ncube makes u-turn on cellphone levy – NewsDay Zimbabwe

FINANCE minister Mthuli Ncube has made a u-turn on the proposed US$50 cellphone levy, which he said would apply to individuals who would have failed to pay duty on imported cellphones.

Ncube’s original proposal, which he made in the 2022 national budget, triggered a public outcry.

But during the debate on the Finance Bill in the Senate on Tuesday, Ncube said the US$50 levy was a mechanism to enforce the payment of the 25% duty.

“When it comes to other electronic gadgets, we have actually reduced the duty to zero. The only duty remaining is the 25% duty on phones.  So what is the problem we trying to solve?  The problem we are trying to solve is that no duty of 25% is being paid by anyone who is bringing phones into the country.  Why?  Because these are small gadgets, you put them in your pocket or wherever in your handbag and you pass through the border.  No duty is paid.

“We are not collecting anything.  What we are trying to do is to design a mechanism that can enforce the payment of the 25% duty, hence this 50% levy.  It is only payable if you cannot prove that you have paid the 25% duty.  So it is not a duty, it is an enforcement mechanism to enforce the payment of the duty which already exists in the first place.”

Senator Chief Ndlovu proposed that the Finance ministry should scrap off the levy or lower the payable levy as citizens were having challenges to reclaim the funds they would have paid to the Zimbabwe Revenue Authority (Zimra).

“We do realise that once the duty is paid to Zimra, the proposal is that the person who is paying has to go and claim the US$50 from Zimra. You realise that it is going to cause challenges to the poorest in the community, some of whom will be in rural areas. To try and recover US$50 from Zimra is a huge challenge. We know the challenges that we have with Zimra even if you are looking at companies that have got millions of dollars, they struggle and it is going to be worse for someone who is travelling from rural areas to come and claim a US$50 fee that would have been imposed on them,” he said.