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Dairibord seeks duty exemption

BY MISHMA CHAKANYUKA/ RUTENDO MATANHIKE

Dairibord Zimbabwe Holdings says it has submitted an application to government requesting to have the imported element of its raw materials exempted from paying duty in order to keep the company afloat.

Last year, Zimbabwe introduced new tax regulations compelling importers to pay import duty in foreign currency as the country sought to shore up depleting government coffers.

Dairibord, like the rest of industry which relies on imported components, is facing viability challenges as foreign currency shortages intensify in the southern African country.

Chief executive Anthony Mandiwanza told members of the Parliamentary Portfolio Committee on Industry and Commerce during a tour of the company premises this week that Dairibord imports polymers used in manufacturing packaging materials, juice concentrates, powdered milk and preservatives.

“The product we import is powdered milk. That’s the biggest consumer of foreign currency, followed by the polymers that we call the plastic granules to convert into packaging material of all description, because our products need to be packaged into different packaging materials that do not compromise issues of health. The third key import bill is the raw materials which are the ingredients that we put into yoghurts and ice-creams to make them tastier,” he said.

“Our import bill, as a company, is $1,8 to $2 million every month to cover the packaging material and all the other raw materials required. The exports are our surviving pillar as we earn a bit of foreign currency to go towards the working capital of $1,8 to $2 million per month,” he said.

The Dairibord boss said the company had already submitted an application to responsible line ministries so that some of the company’s imports could be exempted from tax.

“Juice concentrates are part of the list that attracts duty in foreign currency. We have already submitted an application to the Minister of Finance and Economic Development and the Industry and Commerce minister to consider exempting these concentrates from duty,” he said.

“From 2009 to August 2018, the dairy industry in general was receiving the necessary foreign currency via the central bank and via its commercial bankers, which saw milk production increasing from 32 million litres in 2009 to 70 million litres in 2018. Ideally, what we would want is to get foreign currency requirements via our commercial banks,” he said.

source:newsday

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