ZAMBEEF has welcomed the government’s 2021 budget plans to increase import tax on all beef, pork, and chicken products to boost and support local production and bring flexibility in the trade.
In his speech during the 2021 budget presentation in Parliament on Friday, finance minister Bwalya Ng’andu announced that the government would increase import duty to 40 per cent from 25 per cent on agro-products such as beef and processed beef products, pork and processed pork products, chicken and processed chicken products as well as fish imported from outside the Southern African Development Community (SADC) and Common Market for Eastern and Southern Africa (COMESA) regions.
In a statement, Zambeef chief executive officer Walter Roodt said import duties were just the first step towards fully tapping into the potential of Zambia in feeding itself and the region.
“We have been asking for this for a long time; farming will again become profitable,” Roodt said, adding that he was pleased with the government’s move to create an enabling environment to grow and improve agricultural production.
“The 2021 budget stimulates economic activity and growth in agriculture and other sectors,” he said.
Zambeef also welcomed government proposals to introduce excise duty at the rate of K1.50 per litre on reconstituted milk, and harmonise import duty rates on reconstituted milk with other forms of milk at 15 per cent.
The introduction of excise duty on flat plastic bags at 30 per cent was also acknowledged as good for the environment.
The government’s plans to support the scaling up of agricultural productivity through mechanisation were also good news for Zambeef, with Dr Ng’andu proposing to zero-rate all tractors for Value-Added Tax purposes. Currently, only tractors up to 90 horsepower are zero-rated.
Dr Ng’andu further proposed to suspend import duty on importation of refrigerated trucks to support the domestic and export markets. This is aimed at building flexibility and mitigating revenue losses.
According to the statement, news of the Kafue Gorge hydropower project coming online was also critical to Zambeef, which is spending K2 million a month on fuel for generators, plus depreciation and capital costs, due to load-shedding.
Welcoming the budget, Roodt expressed concern about the bonded warehouses that allow foreign products to be delivered via Kasumbalesa into the Democratic Republic of the Congo (DRC) without duties.
“Zambia is allowing competition from outside SADC and COMESA to freely access local markets via these warehouses, while they do not comply with ZRA prescribed rules. We hope improved tax administration and border infrastructure will deal with it once it gets announced,” he added.
“Foreign currency leaves Africa while Africa could locally produce the food. DRC is also deprived of import duties due to Zambia allowing the bonded warehouses to operate with impunity from its territory.”
The ‘Buy local’ theme was also highlighted on the question of shoes.
“Zamleather stands ready to supply industrial, security and school shoe requirements and we need government and local businesses to support the local industry, which is how we replace foreign imports and externalised money,” said Roodt.