adminNgoni Dapira Business Correspondent
MUTARE community has called for reinstating of the Travellers Rebate which was reduced last month from $300 to $200. This was highlighted during an African Self Help Assistance Programme policy discussion forum on the Travellers Rebate last week Friday. In his Mid-Term Fiscal Policy Review last year the Finance and Economic Development Minister Patrick Chinamasa reviewed downwards the duty free allowance granted on goods imported by a traveller for personal use once a month, which is known as the Travellers Rebate.
At the forum, those present said instead of the downward review Government should address the fundamental macroeconomic concerns triggering the high imports influx in the country such as the high cost of doing business and high unemployment rate.
They added that improving competence on security checks by the Zimbabwe Revenue Authority was another alternative rather than to impinge and deprive travellers by reducing the rebate.
Cross-border traders also called for a review of the $5 per kilogramme declared for bales of second-hand clothes. They said smuggling of bales of second hand clothes would continue if such prohibitive charges continue. Zimra revenue officer Mr Tinashe Chaibva said the Travellers Rebate had been reviewed downwards due to abuse of the facility, mostly by cross-border traders.
“Government is trying to revive local manufacturing industry and restore the formal sector but cross-border traders were abusing the duty free system bringing in goods for resell at cheap costs not compatible to locally manufactured goods. “This is the main reason why the Travellers Rebate was reduced,” said Mr Chaibva.
The Mutare community however contested this and called for the reinstating of the rebate to $300.
“Government always impinges on the people running away from the real solutions and root causes of our economic turmoil. Corrupt Zimra officials are the ones that allow people to abuse the Travellers Rebate. Goods of a traveller that would have shopped for personal use can easily be distinguished so Zimra should do their job,” said one trader.
Another trader who requested anonymity said: “Government should address the high cost of doing business triggered by high utility costs and high taxation. If this is addressed companies will sell products at low cost to compete against South African or Botswana products usually imported by cross border traders for resell,” he said.
A cross-border trader, Mr Tendai Bvunzawabaya said smuggling of bales of second hand clothes would continue if such prohibitive charges continue.
“Government should realise that people are being forced to go out and look for ways to earn a living. It is not by choice. Including the 15 percent VAT (Value Added Tax) charged it costs about $270 for a declared bale of second-hand clothes to enter the country. That is too much. If they charge $2 per kg it is more reasonable,” said Bvunzawabaya.
Trade in second-hand clothing has become a common feature in Mutare, which is the eastern gateway to Mozambique. In his Mid-Term Fiscal Policy Review last year Minister Chinamasa banned the importation of second-hand clothing with effect from September 1 last year.
Mr Chaibva however said up-to-date no Statutory Instrument on the pronouncement by Minister Chinamasa was never put to effect which makes it still legal to import second hand clothing.
The ban call came following a loud outcry from the Zimbabwe Clothing Manufacturers Association that has been feeling the pinch of the cheap second hand clothes on business.
In his report to Government the Zimbabwe Clothing Manufacturers Association president Mr Jeremy Youmans said that populist policies had been derailing attempts to revive local clothing industry.
“The informal sector evades paying tax and a dip in revenue collections to treasury has been the order of the day. However, the formal clothing manufacturing companies currently experiencing low sales due to cheap import are the ones that pay taxes. This anomaly has to be corrected,” said Mr Youmans in his report last year.
Economist Mr Thomas Masese said Government should address the root causes pushing people to smuggle second clothes and abuse the Travellers Rebate facility.
“Efforts need to be made to make local clothes more affordable to local consumers, which will lead to the issue of the need to address the high cost of doing business in the country.
“There is also need to address fundamental problems of high unemployment and subdued incomes earned by the general public, which is what forces people to buy cheap used clothes,” said Mr Masese.
Fairly new, original clothing labels for women can go for as little as $2 or even $1 at the Sakubva Flea-market. ASAP executive director, Mr Regai Tsunga said it was important to discuss policy pronouncements especially when they affect the livelihood of the public.
“Issues that affect people’s finances are important to discuss which is why we organised this meeting. At times Government reviews some policies without congruency and consideration of the aspirations of the people. This is why it is important to have a critique and make recommendations as we shall do,” said Mr Tsunga.
Industrialists have over the years blamed the porous nature of the country’s borders for many of the problems bedeviling industry.
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