‘Govt impoverishes cross-border traders’

Source: ‘Govt impoverishes cross-border traders’ – NewsDay Zimbabwe

GOVERNMENT’s recent unilateral decision to slash travellers’ rebate and placing restrictions on those using public transport, has further impoverished the disadvantaged, who subsidised their monthly basic needs baskets through cross-border shopping sprees, the Poverty Reduction Forum Trust (PRFT) has said.

by Phyllis Mbanje

In its March 2016 basic needs basket survey, PRFT noted that the average household monthly income had dropped from $500 to $224.

Late last year, government revised travel rebates from $300 to $200 for travellers in private vehicles and removed rebate on goods imported by a traveller using a commercial vehicle drawing a trailer.

“By specifying that the rebate shall not apply to ‘goods imported by a traveller and being transported by a transport service vehicle, which is drawing a trailer and is used for conveyancing of goods through a port of entry’, the government is prejudicing poor people and informal traders who use such transport facilities,” Judith Kaulem, PRFT executive director said.

The decision by the government to classify such goods as commercial cargo puts those informal cross-border traders merely using such means for ferrying personal goods at a disadvantage compared to other travellers using private vehicles importing similar goods.

“The decision is discriminatory, as mostly the poor use such modes of transport, normally in groups, as a cost-cutting measure.”

Cross-border traders, particularly women, prefer importing groceries for family consumption.
In addition, as a result of these amendments, the cross-border traders now have to contend with increased time delays as the Zimbabwe Revenue Authority thoroughly checks their goods for tax compliance.

This new development has the potential to increase corruption and smuggling of goods, PRFT warned.
Cross-border traders and other poor travellers were benefiting from the rebate of $300, as they could bring in more goods for personal consumption and for their families duty-free.

However, the reduction of the rebate to $200 has a direct impact on the amount of goods they can now bring in.

The appreciation of the US dollar against the South African rand has contributed to loss of competitiveness of the Zimbabwean products, as South African imports become even cheaper.

However, the government says the rationale behind the statutory changes on travellers is to enhance revenue collection for the country through curtailing the abuse of the facility by cross-border traders.

It is also aimed at promoting growth of the local industry through shielding them from import competition.