Zimra descends on second-hand tyre dealers

THE Zimbabwe Revenue Authority (Zimra) has pounced on Chinese-owned companies selling motor vehicle tyres that are suspected to have been smuggled into the country.

In an interview, Zimra spokesperson, Canisio Mudzimu said he was not obliged to divulge information on any blitz they conduct.

"Section 34A of the Revenue Authority Act [Chapter 23:11] precludes the Zimbabwe Revenue Authority (Zimra) from divulging specific details pertaining to its clients to a third party. I am, therefore, unable to respond to the questions you have asked because of the said secrecy provisions," he said.

However, following an outcry by tyre traders, NewsDay visited some Chinese-owned companies in Willowvale industrial site, where reports indicated Zimra pounced and ordered them to close shop.

At one of the retailers, Gabelton, security guards confirmed they were told to close shop by the revenue authority, which is now seized with its own investigations.

"Zimra officials came last week and told us to close. I am not sure if they took away the tyres or they just closed the shop, as they do their own investigations. Unfortunately, I cannot help you further because I was hired recently to ensure no one comes in," the security officer said, while refusing to give names or contacts of the company directors.

Some of the tyre retailers claimed they were being pushed out of business by unscrupulous traders, who are illicitly bringing their products without following procedure. They implored the government to take action.

"Some of those people are responsible for the cash crisis that we are facing. They demand cash only and if it is bond notes they will then contract some guys at the black market to look for US dollars for them. One bond note is equal to one US dollar, but they are not hesitant to give out ridiculous incentives to people selling US dollars.

This has also caused problems for the majority. As for our tyre business, we are slowly being pushed out of business," said a retailer, who preferred anonymity.

Last week, Zimbabwe National Chamber of Commerce chief executive officer, Christopher Mugaga, appeared before the Parliamentary Portfolio Committee on Finance to speak on the 2018 National Budget and said smuggling of goods was killing formal businesses.
He said 50% of tyres sold in the country every year were second hand.

"No matter how we continue to incentivise exporters, they continue to be outweighed by those that are smuggling because after the introduction of the $300 million bond notes, we still see a lot of them in the informal economy, and even if you go to Messina, the bond note is trusted more than the rand," Mugaga said.

"For example, second-hand tyres are not allowed into the country, but the Zimbabwean market consumes 1,3 million tyres annually and out of that figure the consumption of second-hand tyres that are smuggled in is 50%."

For a long time, Zimbabwe has been a market for cheap products in a grand plan to fish out United States dollars.

Currently, the country is struggling with a serious liquidity crisis amid revelations that the Chinese owners were illicitly sending out people to buy cash at the black market with lucrative rates.