Car import duty up

via Car import duty up | The Herald June 18, 2015

The Zimbabwe Revenue Authority (ZIMRA) unilaterally increased import duty on all second-hand motor vehicles with effect from last Wednesday.

The move has resulted in duty for a wide range of motor vehicles increasing by between $200 and $400, while those importing top-of-the-range second-hand models are forking out more.

Where importers used to spend at least $6 000, they now need $400 more.

ZIMRA director of corporate and legal affairs Ms Florence Jambwa could not respond to questions sent to her on Monday by end of day yesterday.

However, a ZIMRA official at Beitbridge Border Post said the changes sought to ensure uniformity in terms of duty paid for various vehicles at all border posts.

“We are now calculating value of duty based on a national catalogue, which has since been dispatched to all borders. In previous years, individual stations were using varying values for duty purposes (VDP), but now we are calculating duty based on one standard VDP.

“For instance, we had the same type of vehicles paying different duties at different ports of entry and under the latest development, the duty is now uniform.”

However, the percentages upon which import duty was calculated remained unchanged.

Under the current import duty schedule, buses with a carrying capacity of 26 passengers and above pay 40 percent, double cab trucks 60 percent, and passenger motor vehicles of engine capacity below 1500cc attract duty of 40 percent.

Those vehicles with engines above 1500cc are charged 86 percent duty inclusive of VAT and Surtax.

“As it stands all vehicles are paying an average customs duty of 86 percent regardless of engine capacity. What has just changed is just the value on which the duty is calculated,” said the official.

The source added that import duty on vehicles was calculated based on year of manufacture and fuel transmission (automatic or manual).

The new development has seen the tax authorities processing very few car imports at the Manica Transit shed in Beitbridge.

In separate interviews car dealers and clearing agents lambasted ZIMRA for imposing the new values without prior notifications or consultations.

Investigations by the Herald indicate that cars such as Toyota Corolla bubble shapes, Honda Fit, Toyota Corolla old shape, Toyota Raum which are on high demand were the worst affected by the new regulations.

Many people were now importing their vehicles via Chirundu boarder, but this will soon be a thing of the past as the duties have been made uniform.

The majority of Zimbabweans and smaller companies do not afford new cars and they have been relying on on used cars mainly from Japan, the United Kingdom and to some extent the United States of America.