News / Local
Car import ban costs Zimra $3 billion
08 May 2021 at 08:09hrs | Views
ZIMBABWE lost more than $3 billion in potential revenue in April alone following its ban on imports of vehicles that are older than 10 years. The number of vehicles imported has dropped steeply by between 2 000 and 3 000 per month.
The drop also has ripple effect in the motor and downstream industries, with hundreds of Zimbabweans rendered jobless. On April 2 this year, Zimbabwe effected Statutory Instrument 89/2021 which banned all imports of mostly pre-owned cars that are 10 years and older.
Figures of car imports dropped steeply from 4 776, 4 153, 5 100 in January, February and March, respectively, to 2 034 in April when the new law came into effect.
"In January, February and March 4776, 4153 and 5 100 cars, respectively were imported into the country through Beitbridge. Revenue collected from those imports was $805 603 213,40 in January, $3 140 785 433,30 in February and $4 062 889 835,52 in March," the Zimbabwe Revenue Authority said in response to questions from NewsDay.
"In April, $1 814 664 161,79 was collected," said Zimra spokesman Francis Chimanda.
"Statutory Instrument 89 of 2021 was promulgated on April 2 2021 and the number of vehicle imported in April as at 26 April 2021 is 2 034 down from 5 100 in March 2021," he said.
The difference is around $3 billion and at that rate, the country would have potentially lost $36 billion by December. The Ministry of Industry and Commerce said it had become necessary to ban cars 10 years old and above to protect the local industry, which critics say is non-existent.
Industry officials, during a recent visit to Beitbridge, had no idea what the local car manufacturing industry was producing. The decision has not been popular with many people who feel the cars filled the gap which local car manufacturers cannot not fill.
The vehicle imports had also created employment for shipping agents and drivers and will likely hit new business for insurance companies.
The officials were in Beitbridge to assist cross-border traders launch self-help schemes following effects of COVID-19 work recess that has left thousands of people struggling.
Apart from South Africa, with several car manufacturing plants, most countries in Southern Africa rely heavily on imports of Japanese pre-owned cars.
The drop also has ripple effect in the motor and downstream industries, with hundreds of Zimbabweans rendered jobless. On April 2 this year, Zimbabwe effected Statutory Instrument 89/2021 which banned all imports of mostly pre-owned cars that are 10 years and older.
Figures of car imports dropped steeply from 4 776, 4 153, 5 100 in January, February and March, respectively, to 2 034 in April when the new law came into effect.
"In January, February and March 4776, 4153 and 5 100 cars, respectively were imported into the country through Beitbridge. Revenue collected from those imports was $805 603 213,40 in January, $3 140 785 433,30 in February and $4 062 889 835,52 in March," the Zimbabwe Revenue Authority said in response to questions from NewsDay.
"In April, $1 814 664 161,79 was collected," said Zimra spokesman Francis Chimanda.
"Statutory Instrument 89 of 2021 was promulgated on April 2 2021 and the number of vehicle imported in April as at 26 April 2021 is 2 034 down from 5 100 in March 2021," he said.
The difference is around $3 billion and at that rate, the country would have potentially lost $36 billion by December. The Ministry of Industry and Commerce said it had become necessary to ban cars 10 years old and above to protect the local industry, which critics say is non-existent.
Industry officials, during a recent visit to Beitbridge, had no idea what the local car manufacturing industry was producing. The decision has not been popular with many people who feel the cars filled the gap which local car manufacturers cannot not fill.
The vehicle imports had also created employment for shipping agents and drivers and will likely hit new business for insurance companies.
The officials were in Beitbridge to assist cross-border traders launch self-help schemes following effects of COVID-19 work recess that has left thousands of people struggling.
Apart from South Africa, with several car manufacturing plants, most countries in Southern Africa rely heavily on imports of Japanese pre-owned cars.
Source - newsday
