. Chikwanda

By MAIMBOLWA MULIKELELA –

FINANCE Minister Alexander Chikwanda has said the proposed amendments to the Customs and Excise Tax Act will promote value addition and stimulate local production in the manufacturing sector.
Presenting amendments to the 2014 Customs and Excise Tax Bill in Parliament for Second Reading, Mr Chikwanda said the Government wanted to amend the Act to increase duty on un-denatured spirits and alcoholic drinks and increase customs duty on explosives, roofing sheet, edible oils and aviation fuel.
Mr Chikwanda said Government was committed to accelerating the strategy on industrialisation and job creation aimed at reducing poverty.
“In doing so priority investment sectors have been identified while qualifying investors in these sectors are entitled to various tax and non tax incentives. It is keeping up with this commitment that the
proposed amendments to the Bill have been proposed,” he said.
Mr Chikwanda said while Zambia remained a member of both the Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC), it was envisaged that the proposed tax measures would contribute to supporting business development in the explosives, edible oils and roofing sheets sub-sectors.
This would be by promoting competitiveness, fostering value addition and stimulating local production and employment creation.
Mr Chikwanda additionally in proposing amendments to the Income Tax Bill which was presented for Second Reading said the changes to Presumptive Tax would not have an adverse effect on public passenger vehicle operators but was only meant to ensure tax compliance.
Presumptive Tax was introduced in 2004 and currently ranged between K600 and K7, 200 per annum, depending on the sitting capacity of a vehicle. With proposed changes, the payable rates would now range from K1, 200 to K14, 400 per annum.
“The Bill also seeks to rationalise income tax deductions when determining taxable income by restricting the deduction debts incurred by banks and other financial institutions to debts only not covered by security or collateral pledged,” he said.
The Bill further proposed the streamlining of the requirement to submit income tax returns and financial accounts in line with advances that the Government has made regarding electronic filling of returns and that other alterations were meant to align the Income Tax Act to relevant provisions in other Acts and also strengthen the law for better and effective tax administration.