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Mthuli scraps VAT deferral for importers

 

BUSINESS REPORTER

 

Professor Mthuli Ncube, Minister of Finance, Economic Development, and Investment Promotion, has removed the Value Added (VAT) deferments provision that was offered to operators who owed money on their taxes so they could import essential capital equipment.
The facility is being removed with immediate effect. The purpose of the provision was to make it easier to import capital equipment that had a minimum value of $500,000.

 

Professor Ncube said in a notice over the weekend that the facility was intended to provide cashflow relief to taxpayers who import capital equipment with a minimum Cost, Insurance and Freight (CIF) value of US$500 000.

“Treasury notes with concern, the number of beneficiaries that are not honouring their VAT obligations upon the expiry of the deferment periods.

“In view of the above, the following measures shall apply with immediate effect: VAT deferments granted to operators with outstanding VAT payments on tax deferred are hereby withdrawn forthwith.

“This means that tax is payable immediately, failure of which enforcement measures are provided in the tax legislation will be applied,” he said.

“Operators who have defaulted on VAT deferred shall with immediate effect, no longer qualify for the facility.

“No further tax concessions, in whatever form, will be granted to operators who have previously failed to honour their VAT obligations on tax-deferred, including failure to honour taxes due on other tax heads.”

 


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