via Government to overhaul tariff regime | The Herald November 18, 2013
GOVERNMENT has pledged its commitment to revive the local industry by embarking on a complete overhaul of the current tariff regime which had made it difficult for local manufacturers to produce competitive products. In January last year, the Zimbabwe Revenue Authority announced that a 25 percent surtax would be charged on a wide range of imported items.
The list of items included a variety of fresh vegetables, meat and dairy products, as well as goods like flour, pasta, bread and cakes. Alcohol and cigarettes were also not spared the surtax, along with items like cosmetics, footwear, candles and soap.
The new regime would put more stringent measures on the importation of goods that are locally available.
Industry and Commerce Minister Mike Bimha last week said the process of overhauling the tariff system would involve consultations with the finance ministry since the issue would have implications on revenue.
“Government will leave no stone unturned as it seeks to review the entire tariff regime in order to lower production costs for local producers.
“This exercise should be done in totality; it will not focus on particular products or sectors but will look at industry as a whole.
“We need to look at what products we can produce in sufficient quantities, with high quality and competitive prices and then see how we can apply duty on such products,” he said.
Zimbabwe’s import bill has been rising in the past decade due to the demise of the manufacturing industry which was exacerbated by the illegal sanctions imposed by western countries.
As a result, local industry has been failing to meet demand. Imports reached US$6,6 billion against exports of US$2,3 billion in the nine months to September this year.
Minister Bimha said some retailers who were forced to import almost everything during the hyper-inflationary period had continued to import goods that are now locally available putting local industry under strain.
“Some have taken advantage of our porous borders to bring in goods that are locally available without paying any duty hence prejudicing the Zimbabwe Revenue Authority of potential revenue.
“For the tariff exercise to work, we have to deal with the issue of the borders first and then apply the new tariff regime,” he said.
He said Government would place special consideration on local manufacturers who import raw materials and other inputs to add value to their products to ensure that their products can remain competitive.
Meanwhile on Friday Government gazetted Statutory Instrument 157 of 2013 which suspended duty on power equipment, critical spares and transformer components imported by Zesa Enterprises (ZENT), Zimbabwe Electricity Transmission and Distribution Company (ZETDC) and the Zimbabwe Power Company for one year.
COMMENTS
But as we all know,the poorer consumers will be faced increased pricing of local and in many cases inferior quality products and the end result will be that people will still pay more on imported products which in many cases are better value for money.The rich will not be affected by this as they will continue to buy the expensive imported products and it is only the poor who will be forced to consume the local products regardless of the quality:we have seen this time and again where such taxation on imported itmes invariably result in the locals putting up their prices even where the quality is clearly poorer
Of course
Zanu PF wasted the 5 years of Government of National Unity trashing every MDC initiative. Now after the elections, Zanu PF is suddenly embracing MDC policies to try and improve the economic environment for local companies. But trust is not built on violence and greed.
Since we produce barely nothing, what are we talking about ? Even for the products/services that we do have available, we assign everything almost to the Chinese.
and you had better beleive that the chinese are going to start industriesa nd transfer the dollars to external banks, impoverishing the economy further. look at the diamonds for example. the party get a tithe and the external banks the fat cheques.
As long as products are locally manufactured means more jobs for our jobless. The price is being discounted thats why there is a surtax. If you decide to buy imports you pay more but still available.
1. it looks like border traders are going to be prevented from border trading because they will have to have licenses to import. This will cut off employment from the 90 % who are unemployed and who are dependent on border traders for cash [unemployed husbands and dependent children]
2. it looks like there will be local monopolies, destroying competition, therefore quality falls and prices rise [inflation]
3. it looks like only chefs are going to get the licenses so the economy will be zanu pf ised.