via Zimra gets tough on Harare City | The Herald 15 July 2014 by Farirai Machivenyika
REHABILITATION work at Harare’s major waterworks at Morton Jaffray is being stalled after the Zimbabwe Revenue Authority withheld four containers containing equipment at Forbes Border Post in Manicaland in a bid to force the council to clear US$42 million it owes in taxes.The equipment is exempted from paying duties after the project was granted National Project Status, but Zimra wants the city to pay up taxes owed in other areas in exchange for the release of the equipment.
China Machinery Engineering Corporation chief representative Mr Zhang Xin yesterday told the Portfolio Committee on Water, Environment, Tourism and Hospitality Industry that delays in releasing the equipment could delay completion of the project.
The capital’s water and sewer plants are undergoing refurbishment by Mr Zhang’s CMEC under a US$144,4 million loan facility obtained from China EximBank.
Mr Zhang said they were considering stopping further shipment if zimra continued intercepting the equipment.
“We have some challenges as some of our equipment is stuck at the border because zimra is refusing to issue tax rebates on the equipment,” Mr Zhang said. “We have been told that it has something to do with what council owes zimra, but this project has national status. What we are saying is we should separate internal issues with the project.
“We already have more equipment that is at sea and we are now afraid that it will also be stuck at the border. If things continue like this then we will have to stop shipment.”
The containers have an assortment of equipment for construction, workshop and pumps.
Apart from delays at the border, Mr Zhang said there were delays in the release of the money by China EximBank that could also delay the project.
A Harare City Council source confirmed that the equipment was being withheld by zimra over the outstanding tax bill.
Chairperson of the committee and National Assembly representative for Midlands Province Cde Anastancia Ndlovu said the committee would take up the matter with relevant authorities.
“The US$144,4 million loan facility should take the City of Harare to another level in terms of provision of clean and safe water. Therefore, delays at the border need to be followed up because we don’t want zimra to delay progress of a project that will help our people,” she said.
“It also has to be taken into account that provision of clean water is also instrumental in the success of Zim-Asset because nothing can be done without water.”
Harare’s water and sewerage treatment plants have outlived their lifespan that has seen council supplying water to 40 percent of the city’s residents.
Supplies are expected to improve by up to 80 percent when rehabilitation of the plants is completed by the end of the next year.
Last month, zimra garnished US$3 million from the City of Harare’s accounts over the US$42 million debt.
The implementation of the refurbishment project has been bedevilled by a number of challenges that include overpricing of equipment, while council officials spent up to US$2 million of the loan funds to buy luxury vehicles.