Incentives Under Customs And Excise

RATES OF SPECIAL EXCISE DUTY ON CHANGE OF OWNERSHIP OF SECOND HAND MOTOR VEHICLES:

With effect from the 1st January, 2016, the amounts of excise duty payable on change of ownership of second hand motor vehicles are as per the table below:-

 

Number of Years

Engine Capacity

Special Excise Duty Rate (US$)

 

 

 

0-4

1000cc

300

1001-1500cc

400

1501-2000cc

500

2001-2500cc

600

2501-3000cc

600

3001-3500cc

600

Above 3501cc

600

 

 

 

5-10

1000cc

150

1001-1500cc

200

1501-2000cc

250

2001-2500cc

300

2501-3000cc

400

3001-3500cc

400

Above 3501cc

400

 

 

 

11-15

1000cc

75

1001-1500cc

100

1501-2000cc

150

2001-2500cc

200

2501-3000cc

200

3001-3500cc

200

Above 3501cc

200

 

 

 

16-20

1000cc

50

1001-1500cc

75

1501-2000cc

100

2001-2500cc

150

2501-3000cc

150

3001-3500cc

150

Above 3501cc

150

Above 20

All Engine Capacity

50

 

TAX INCENTIVES

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:

Rebates, Refund or Suspension of Duty

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

It is granted on the following 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:

  • eucalyptus, pine and other oils for use in the extraction of gold and other minerals by the flotation process
  • chemical substances, other than spirits, methylated spirits, fuel oils, lubricants and nitrate of lead, for use in any process for the concentration or refining of ore, or for assay or research purposes

(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. The condition is that the components or materials must not be produced locally.

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

Suspension of customs duty on goods imported for specific operations to be carried out for or in connection with the development of a mine situated in a mining area and include:

  • the sinking of shafts; and
  • the installation of machinery, equipment, implements, utensils and other articles required for the purposes of producing minerals; and
  • the construction and erection of facilities for the production, treatment, storage, gathering and conveyance of minerals.

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

This provides for rebate of duty on goods imported for use in a process of manufacture of goods for export. Anyone who wants to import or take out of bond goods for inward processing should first apply and get registered under this facility.

(k) 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.

(l) 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.

(m) 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.

(n) 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.

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

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

(p) 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.

The 7 day Credit facility for importations SI 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 fulfilment of the prescribed conditions. The person making entry of such goods thus defers payment of the duty thereon for a period of up to seven days from the date of entry.

 

 
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