VAT on soyabeans affecting production

VAT on soyabeans affecting production

Source: VAT on soyabeans affecting production | The Financial Gazette May 3, 2018

The soyabeans price had always been double that of maize until the maize price was set at $390 leading to a reduction in the price differential.

The soyabeans price had always been double that of maize until the maize price was set at $390 leading to a reduction in the price differential.

THE country’s 15 percent Valued Added Tax on soyabeans has been identified as one of the major challenges affecting soyabeans production.

Submissions by the Zimbabwe Economic Policy Analys is and Research Unit (ZEPARU) to the CZI show that a farmer producing soya beans valued at $5 000 exceeds the VAT registration threshold and must, therefore, register and be charged 15 percent VAT for soyabeans sold.

“This negatively impacts on soya bean production and subsequently the whole value chain as it eats into the marginal profits of the farmer hence a disincentive for continued production and locks the country into import reliance. Even if the farmers are to pass it on to the consumers they cannot afford increasing the prices further given the cheaper imports from countries like Zambia,” the ZEPARU report said.

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