Tax on Imported Rice Riles Grain Millers
The Grain Millers Association of Zimbabwe (GMAZ) has petitioned government over the re-introduction of Value Added Tax (VAT) on imported rice, saying the commodity should not be levied because it is supplementing the maize meal which is scarce in the country.
In his 2017 budget statement, Finance Minister, Patrick Chinamasa, said government is going to re-introduce VAT on rice, despite the commodity being an alternative for maize meal which Zimbabwe is struggling to import and feed the starving nation. The country is in dire need of maize to feed more than four million people who were affected by the last season’s devastating drought.
The most affected are school going children in the rural areas most of whom are being forced to drop out of school.
In some areas people are sharing wild fruits with animals because of the biting hunger. In the petition which they delivered to the Finance minister, Patrick Chinamasa, this week, GMAZ chairman, Tafadzwa Musarara, said more people are going to die of hunger if government re-introduces VAT on imported rice which has become an alternative in the absence of sufficient maize.
“Rice has become an alternative staple of maize meal and is well placed in diet for millions of our people as key source of starch and carbohydrates,” said Musarara.
According to GMAZ, rice consumption has grown from 50 000 metric tons per annum in 2009 to 200 000 metric tons to date owing to not only for its affordability but also because of the high demand created by the drought.
“The re-introduction of VAT on rice will trigger a 15% price increase and this will no doubt create inflationary pressure on the food production chain and given the current prevalent low incomes consumers will not be able to sustain the price increases and will invariably reduce consumption,” Musarara argued.
“Besides government having not consulted the industry on this matter, there is no rice farming in the country which will be prejudiced its importation and continued suspension of VAT on it causes no harm to our economy,” he suggested.