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The recent move by the Government to suspend import duty and import value-added tax (VAT) on selected groceries is something Zimbabweans have become familiar with as it happened exactly 12 months ago.
The suspension was lifted in late November 2022, which means it has taken the Government just six months to reverse its decision amid soaring prices and a runaway exchange rate.
On Friday, 12 May, the Government suspended import duty and import value-added tax (VAT) on 11 basic grocery items: maize meal, rice, milk, flour, sugar, salt, cooking oil, petroleum jelly, toothpaste, bath soap and washing powder.
The suspension of the import duty and import VAT shall be valid for six months from 12 May 2023.
The development evokes a sense of déjà vu as similar measures to address rampant price increases were put in place in May 2022.
In May last year, Ministry of Finance and Development permanent secretary George Guvamatanga directed Zimbabwe Revenue Authority (ZIMRA) then acting Commissioner-General Regina Chinamasa to suspend duty on selected products for a period of six months with effect from 17 May 2022. Wrote Guvamatanga:
<blockquote>
Reference is made to the press statement by the Minister of Finance and Economic Development where a pronouncement was made regarding the introduction of measures aimed at ensuring access to affordable basic commodities, in view of the recent substantial increases in prices of locally manufactured products.
In view of the above, Zimbabwe Revenue Authority is hereby authorised to suspend duty on the following products for a period of six months with effect from May 17, 2022.
</blockquote>
Rice, flour, cooking oil, margarine, salt, sugar, maize meal, milk powder, infant milk formula, tea (whether or not flavoured), petroleum jelly, toothpaste, bath soap, laundry bar were to be imported duty-free.
Finance and Economic Development Minister Mthuli Ncube scrapped the suspension of import duty when he presented the 2023 national budget on 24 November 2022.
In his budget presentation at the New Parliament Building in Mt Hampden, Ncube said:
<blockquote>
Mr speaker sir, the government suspended customs duty on basic commodities in order to cushion consumers from unjustified price increases, this measure has contributed to stability in prices of basic commodities, hence the suspension which expired on November 16, 2022 will not be extended.
</blockquote>
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Pindula News

Six Months Ago Govt Re-imposed Duty On Basic Groceries

Reserve Bank of Zimbabwe (RBZ) Governor John Mangudya said that the measures announced by the Ministry of Finance and Economic Development on Thursday to stabilise the exchange rate and prices will support the issuance of gold coins and tokens by the central bank.
On Thursday, Treasury lifted restrictions on the importation of 11 basic grocery items, while granting companies 100 percent retention of domestic foreign currency sales as part of measures to stabilise the exchange rate and prices.
Speaking to <a href="https://www.sundaymail.co.zw/rbz-confident-of-price-stability">The Sunday Mail</a>, Mangudya said the measures introduced by Treasury last week will promote deposits into the banking sector. He said:
<blockquote>
The new measures announced by the Ministry of Finance, including the 100 percent retention of domestic foreign currency earnings, are for three reasons, which means, for starters, companies can now bank their money (forex).
They were not banking their money, so the new measure promotes deposits into the banking sector and increases liquidity in the banking sector.
Also, companies can now use their own money for importation, thereby reducing demand for foreign currency on the auction system.
This buttresses and supports the issuance of gold coins and tokens, as it seeks to reduce the demand for foreign currency.
</blockquote>
Mangudya also said the newly introduced gold-backed digital tokens valued at more than ZWL$14 billion were taken up by the market last week.
He said the huge demand for gold coins and digital tokens could help remove excess liquidity and stabilise the Zimbabwe dollar.
Persistence Gwanyanya, an economist and member of the central bank’s Monetary Policy Committee, said:
<blockquote>
Retailers and wholesalers see the gold digital tokens salvaging their businesses from the accelerated depreciation of the local currency.
They have been losing competitive advantage to small and informal businesses that have been rejecting the currency and insisting on transacting in US dollars.
Given their visibility and position in the market, it is very difficult for them to reject the local currency without consequences.
The acceptance of digital gold-backed tokens by key wholesalers and retailers will be a huge relief to the transacting public.
</blockquote>
In line with the measures announced by Finance and Economic Development Minister Mthuli Ncube on Thursday, the Government on Friday suspended import duty and import value-added tax (VAT) on 10 basic grocery items: maize meal, rice, milk, flour, salt, cooking oil, petroleum jelly, toothpaste, bath soap and washing powder.
The suspension of the import duty and import VAT shall be valid for six months from 12 May 2023.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Mangudya Backs Measures Announced By Mthuli To Stabilise Exchange Rates, Prices

The <a href="https://www.pindula.co.zw/Zimbabwe_Revenue_Authority">Zimbabwe Revenue Authority (ZIMRA)</a> has advised that importers of goods whose duties are ordinarily payable in local currency now have the option to pay duty in foreign currency. In a notice seen by Pindula News, ZIMWA said the development was made possible by the amendment of section 115 of the Customs and Excise Act (Chapter 23:02) following the promulgation of Finance Act No 8 of 2022. Reads the notice:
<blockquote>
<h2>PUBLIC NOTICE: PAYMENT OF DUTY IN FOREIGN CURRENCY ON NON-DESIGNATED GOODS</h2>
The Zimbabwe Revenue Authority (ZIMRA) wishes to advise all valued clients that following the promulgation of Finance Act No 8 of 2022, section 115 of the Customs and Excise Act (Chapter 23:02) has been amended to give importers of non-designated goods (whose duties are ordinarily payable in local currency) an option to pay duty in foreign currency.
Currently, our system is being configured to register declarations (bills of entry) that enable payment of duty on non-designated goods in foreign currency. In the meantime, while our ICT department is working on configuration of our ASYCUDA system, the following measures have been taken to assist clients and to facilitate trade:
Clearance of consignments of non-designated goods for which importers opt to pay duty in foreign currency shall be done through lodgment of manual bills of entry and the following procedure shall be adopted.
• The importer or clearing agent shall apply to the Shift Manager/Station Manager to lodge a manual bill of entry. 
• When authority to lodge the manual bill entry has been granted, the importer or clearing agent shall submit the manual bill of entry and supporting documents for processing in the usual manner.
NB: Please note that this is a temporary measure meant to facilitate trade that will end upon successful configuration of the system.
</blockquote>
<h2><a href="https://zero.pindula.co.zw/">More Pindula News</a></h2>

ZIMRA Speaks On Payment Of Duty In Foreign Currency For Non-designated Goods

The govt of Zimbabwe has scrapped all duty from all productions imported by ZESA in a bid to help the struggling power utility company.
According to a government gazette, <a href="https://www.pindula.co.zw/Mthuli_Ncube">Mthuli Ncube</a> scrapped duty for 2 ZESA for 2 years for:
<blockquote>….power equipment, critical spares and transformer components imported by Zesa for a period of two years with the effect from June 1, 2019.</blockquote>
ZESA is ridden with debt and <a href="https://news.pindula.co.zw/2019/09/21/mono-currency-switch-made-zesa-lose-4-billion-report/">has come out to say they were overwhelmed with international debt which took a new twist when the currency issues st</a>arted.
More:<a href="https://www.thestandard.co.zw/2019/11/03/zesa-gets-lifeline/"> The Standard</a>
<blockquote> </blockquote>

Govt Gives ZESA A Lifeline

The government of Zimbabwe has exempted forex duty on essential raw material imports for some food and beverage companies. The Statutory Instrument (170 of 2019) was gazetted on Friday, 9 August 2019.
Said part of the Statutory Instrument:
<blockquote>with effect from date of Gazetting the persons designated in the Second Schedule to this notice shall be allowed to import the goods with the listed commodity codes being imported entirely for use in their production process in quantities not exceeding the quantities specified against each person listed in the Second Schedule, and pay for the duty in any currency acceptable in Zimbabwe as legal tender.</blockquote>
The list of companies listed in the said Second Schedule:
<ul>
<li>Schweppes Zimbabwe</li>
<li>Medent</li>
<li>Dairibord Zimbabwe</li>
<li>Kefalos Cheese Products</li>
<li>Cairns Foods Zimbabwe</li>
<li>Peelchart</li>
<li>Associated Foods Zimbabwe</li>
<li>Kershelmar Dairies</li>
<li>Dendairy</li>
<li>Alpha and Omega</li>
<li>Machiareer Investments</li>
<li>Lobels Biscuits</li>
<li>African Distillers</li>
</ul>
You can <a href="https://t792ae.c2.acecdn.net/wp-content/uploads/2019/08/SI-2019-170-of-2019-Customs-and-Excise-Designation-of-foreign-currency-dutiable-goods-Notice-2019-IMPO.pdf">download the Statutory Instrument here</a>.

Government Grants Select Food & Bev Companies Forex Duty Exemption

Customs and excise duties have increased threefold.
The increase is due to the value of the new value of RTGS Dollars that has been effected by ZIMRA.
Prices of goods are now being converted to RTGS$ from USD (or Rand, Pula etc…)  before the calculation of duty. People importing goods, especially via Beitbridge border post, are reported have been shocked by the increases yesterday.
Those importing for resale are expected to pass the cost down to the consumers which will result in a drastic increase in prices in the shops.
ZIMRA explained the news prices:
<blockquote>The new currency affects clearance of designated goods by converting current balances in the nostro FCA prepayment account to ZWR at the prevailing exchange rate with the US$.
All foreign currency payments then appear on the payment receipt or prepayment receipt as ZW RTGS dollars
It is hoped that the above information will assist in the clearance process after introduction of the ZW RTGS currency,</blockquote>
<h3>Related:</h3>
<ul>
<li><a data-bump-view="tp" href="https://zero.pindula.co.zw/official-bank-rate-black-market-exchange-rates-today-01-mar/">Official Bank Rate &amp; Black Market Exchange Rates Today – 01 Mar</a></li>
<li><a href="https://zero.pindula.co.zw/zimra-to-continue-collecting-duty-in-foreign-currency/" rel="bookmark">ZIMRA To Continue Collecting Duty In Foreign Currency</a></li>
<li><a href="https://zero.pindula.co.zw/zimra-to-use-patrols-roadblocks-to-combat-smuggling/" rel="bookmark">ZIMRA To Use Patrols &amp; Roadblocks To Combat Smuggling</a></li>
</ul>
More: NewsDay

ZIMRA Increases Duty Threefold

Customs and excise duties have increased threefold.
The increase is due to the value of the new value of RTGS Dollars that has been effected by ZIMRA.
Prices of goods are now being converted to RTGS$ from USD (or Rand, Pula etc…)  before the calculation of duty. People importing goods, especially via Beitbridge border post, are reported have been shocked by the increases yesterday.
Those importing for resale are expected to pass the cost down to the consumers which will result in a drastic increase in prices in the shops.
ZIMRA explained the news prices:
<blockquote>The new currency affects clearance of designated goods by converting current balances in the nostro FCA prepayment account to ZWR at the prevailing exchange rate with the US$.
All foreign currency payments then appear on the payment receipt or prepayment receipt as ZW RTGS dollars
It is hoped that the above information will assist in the clearance process after introduction of the ZW RTGS currency,</blockquote>
<h3>Related:</h3>
<ul>
<li class="entry-title"><a class="bump-view" data-bump-view="tp" href="https://news.pindula.co.zw/2019/03/01/official-bank-rate-black-market-exchange-rates-today-01-mar/">Official Bank Rate &amp; Black Market Exchange Rates Today – 01 Mar</a></li>
<li class="entry-title"><a href="https://news.pindula.co.zw/2019/02/26/zimra-to-continue-collecting-duty-in-foreign-currency/" rel="bookmark">ZIMRA To Continue Collecting Duty In Foreign Currency</a></li>
<li class="entry-title"><a href="https://news.pindula.co.zw/2019/02/25/zimra-to-use-patrols-roadblocks-to-combat-smuggling/" rel="bookmark">ZIMRA To Use Patrols &amp; Roadblocks To Combat Smuggling</a></li>
</ul>
More: NewsDay

Government announced that the suspension of duty on selected commodities came into effect on Wednesday last week according to a Government Gazette published on Friday.
Duty will be suspended on luxury and public service buses, ammonium nitrate fertilisers, fertilised eggs for hatching and powdered raw milk and raw wine all for approved importers and manufacturers. This is contained in Statutory Instrument 279 of 2018. Customs and Excise duty exemptions have been given time-lines with fertilisers and wines suspension running for 12 months from January 01 while fertilised poultry eggs for hatching have six months duty suspension. The decision to suspend duty on fertilised eggs is meant to ensure recovery of the poultry sector that was recently hit by Avian Flu. Duty on imported asmmonium nitrate fertilisers by approved importers is suspended for the next 12 months.
More: <a href="https://www.chronicle.co.zw/government-suspends-duty-on-commodities/">Chronicle</a>

Govt Suspends Duty On Selected Commodities

A Government Gazette published last Friday (May 12) states that Finance Ministern Patrick Chinamasa in terms of Section 235 of the Customs and Excise Act has removed engine spares and components for the National Railways of Zimbabwe (NRZ). The rebate of duty is valid from 1 January to December 31 2017.
This comes as Government recently removed duty for a craft spares in a move set to benefit Air Zimbabwe. NRZ has a debt of $176 million and owes its workers $99 million. The parastatal has 60 operational locomotives out of 166. The locomotives are aged between 33 and 50 years against a lifespan of 25 years. Out of 283 passenger coaches, 106 are functional although they are in a bad state.
More: <a href="https://www.dailynews.co.zw/articles/2017/05/16/duty-on-nrz-spares-scrapped">Daily News</a>

Govt removes duty on locomotive spares in a bid to revive NRZ

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