ZRA explains tax incentives

BUUMBA CHIMBULU writes @SunZambian GOVERNMENT has put in place incentives to grow various sectors of the economy by purposely introducing zero or lower tax rates, says Zambia Revenue Authority (ZRA) Corporate Communications Manager, Topsy Sikalinda. Mr Sikalinda said Government through the ZRA allowed stakeholders to import various goods duty free while others only paid Value Added Tax (VAT) at 16 percent. He said this in his write-up on “Boosting the agricultural sector with tax incentives.” He said among the sectors with a long list of items that were duty free included the agricultural and manufacturing sectors. “The list is so long but we shall try and list few items to just have an idea of what is provided for in the various laws in terms of tax rebates and incentives.  Let us start with items that are both duty free and zero rated meaning no taxes are paid at importation. “These include agricultural fertilisers, herbicides, pesticides, bovine semen and animal embryos, live roses but they require a permit from the Ministry of agriculture before importation.  Other goods are raw materials for manufacturing of various feeds, machinery for milling, machinery for making cereals etc,” Mr Sikalinda said. He said another set of goods would be duty free but would attract VAT only at 16 percent. These goods, he explained, would include crude palm and Soya -bean oil for final processing in Zambia which also required a permit from ministry of agriculture. Mr Sikalinda said other items included solar panels and solar equipment, generator sets, agricultural tractors, ploughs, pumps for liquids and cultivation machinery. “Interestingly truck horses, special purpose motor vehicles, bakery equipment, refrigerating or freezing equipment for cold rooms, poultry incubators, dairy machinery, industrial machinery for manufacturing of drinks, cutting machinery, dry cleaning machinery, water floating tankers and refrigerated vessels are also duty free and they only pay VAT. “These are all great opportunities that give entrepreneurs a boost to start or improve their businesses,” he said. He said goods imported from within the Regional Economic Communities to which Zambia is party such as SADC and COMESA were exempt from paying customs duty if such goods met the origin criteria for the Regional Economic Communities. “This simply means that goods manufactured and originating from countries that a member states of SADC or COMESA are likely to enjoy the duty-free status provide they produce an authentic certificate of origin and meet the requirements as provided by the law,” Mr Sikalinda said.