Incentives Under Customs And Excise | Zimbabwe Revenue Authority (ZIMRA)

Incentives Under Customs And Excise

Tax incentives are generally defined as fiscal measures that are used to attract local or foreign investment capital to certain economic activities or particular areas in a country’. Generally tax incentives must confer an advantage on the beneficiary while at the same time imposing a cost on the government.

The Zimbabwe Revenue Authority administers various tax incentives aimed at promoting investment while the Ministry of Industry and International Trade, the Industrial Development Corporation and the Zimbabwe Investment Authority are the main administrators of non-tax incentives. Revenue incentives in Zimbabwe apply equally to both domestic and foreign investors and the major goals of incentives in place are: -

Income generation
Export promotion
Employment creation and skills transfer
Small business development
Industrial development
Revenue inflows

Like many other developing countries, Zimbabwe offers a number of tax and customs incentives in the form of tax holidays, reduced tax rates, and accelerated depreciation. The incentives are given by sector, type of activity, form of organization, and geographical location of investment as follows:-

Incentives Under Customs And Excise

Most of these incentives come in the form of rebates and suspension of duty and the

summary is shown below.

Rebate, Refund or Suspension of Duty

(a) Rebate of duty on goods for the mining industry

It is granted on specified articles when imported or taken out of bond or purchased from the licensed premises of a manufacturer by a person engaged in the mining industry.

(b) Rebate of duty on goods for the prospecting and research for mineral deposits

Granted on goods which are imported by a person who has entered into a contract with the Government, which is approved by the Commissioner, for the prospecting and search for mineral deposits

(c) Rebate of duty on materials to be used in the preparation and packaging of fresh produce for export

Granted on such materials as the Commissioner may approve when such materials are imported to be used in the preparation and packaging of fresh produce for export by a person or organization approved by the Commissioner.

(d) Rebate of duty on goods imported in terms of an agreement entered into pursuant to a special mining lease

Granted on goods which the Secretary for Mines certifies are eligible for a rebate of duty in terms of an agreement in the special mining lease.

(e) Rebate of duty on goods imported temporarily for an approved project

Granted on goods which are temporarily imported by contractors or other persons for completion of approved projects as may have been approved by the Minister

(f) Rebate of duty on goods for incorporation in the construction of approved projects

Granted on components or materials for incorporation in the construction of approved projects as may be approved by the Minister

(g) Suspension of Duty on Goods Imported for Specific Mine Development Operations

Suspension of custom duty on goods imported for specific mine development operations is granted if the holder;

Applies in writing for the suspension to the Commissioner General,
Submits with such application information and documents,
Obtains and submits with application a certificate from the Secretary that the specific goods are eligible for a suspension
Provides any other information relating to the specified goods that the Commissioner-General may reasonably request.

(h) Refund of duty on capital goods imported for use in tourist development zones

Granted to an operator of a tourist facility in a tourist development zone on capital goods imported for the purposes of or in connection with that tourist facility

(i) Rebate of duty on imports covered by a Duty Free Certificate issued under the export incentive scheme

Granted on capital goods and raw materials specified by the Minister to be eligible.

(j) Rebate of duty on goods imported for Tourist Development Zones

Granted on such equipment and machinery as the Commissioner may approve, when such goods are imported for use in a tourism development zone

(k) Inward processing rebate: S I 59 of 1997

Anyone who wants to import or take out of bond goods for inward processing should first apply and get registered under that facility.

(l) Registered aircraft assembler: S I 18 of 2001

Rebate is granted to a registered assembler on component parts and materials imported or taken out of bond, for use in the assembly of aircraft.

(m) Registered bus assembler: S I 169 of 2004

Rebate is granted to a registered assembler on component parts and materials imported or taken out of bond, for use in the assembly of buses.

(n) Registered electrical manufacturer: S I 378 of 1999

Rebate is granted to a registered manufacturer on component parts and materials imported or taken out of bond, in their completely knocked down state, for use in the manufacture of approved electrical goods.

(o) Registered motor vehicle assembler: S I 13 of 1999

Rebate is granted to a registered motor vehicle assembler on component parts imported or taken out of bond, for use in the assembly of motor vehicles.

(p) Registered tyre manufacturer: S I 265 of 2001

Rebate is granted to a registered manufacturer on materials listed in the 2^nd schedule to the S.I. imported or taken out of bond, for use in the manufacturer of tyres.

(q) Registered pharmaceutical manufacturer: S I 174 of 2005

Rebate is granted to a registered manufacturer on materials imported or taken out of bond, for use in the manufacturer of approved pharmaceutical products.

Bonded warehouse facility

Where one can import goods, without paying the duties due o, e.g. motor vehicles which can only be taken out of bond and the duties paid when one has found a buyer and has raised money for payment of duty.
An importer can warehouse their goods in any licensed bonded warehouse if the proprietor has space. Maximum period to warehouse goods is 2 years.

Origin and Preference

Trade Agreements so that goods can enter Zimbabwe duty free or at lower rates thus making them cheaper

A certificate of origin signed by the exporter or manufacturer of the goods and authenticated by the relevant authority.

Available trade agreements are: COMESA, SADC, Zimbabwe-Malawi trade agreement, Zimbabwe-Botswana trade agreement, and Zimbabwe-Namibia trade agreement.
Exporter should be registered under the relevant trade agreement. A certificate of origin signed by the exporter or manufacturer of the goods and authenticated by the relevant authority

The 7 day Credit facility for importations ,S I 74 of 2009

This is granted by ZIMRA to approved importer or agent wishing to remove imported goods under the 7 day credit facility upon fulfillment of the prescribed conditions. For more details, reference can be made to Customs and Excise General Regulations which can be purchased from Printflow.