Zimbabwe stands firm on grain levies despite GMAZ court action

Efforts by the Grain Millers Association of Zimbabwe (GMAZ) to portray the Government's grain import levy framework as abandoned have suffered a setback after fresh correspondence from the Ministry of Finance confirmed continued State support for revised levies aimed at protecting local farmers, financing irrigation infrastructure and reducing the country's dependence on imports.

The development follows months of debate surrounding Statutory Instrument 87 of 2025, which introduced levies on grain imports as part of Government's broader import substitution and agricultural development strategy.

While an earlier Treasury letter dated March 3, 2026 raised legal concerns over the statutory instrument and recommended its repeal, subsequent correspondence dated April 30, 2026 indicates that Government has instead moved to refine and operationalise the levy framework under revised grain marketing arrangements for the 2025/26 summer season.

The latest letter, signed by Finance Secretary George Guvamatanga and addressed to the Secretary for Agriculture, Mechanisation and Water Resources Development, endorses the continued collection of levies and charges linked to grain imports.

Treasury's position was informed by recommendations from a Joint Technical Committee co-chaired by deputy ministers from the Finance and Agriculture ministries.

According to the correspondence, significant pricing disparities remain between imported grain and locally produced crops, with maize showing a gap of approximately US$40 per metric tonne and soyabeans US$50 per metric tonne.

"These variances have material fiscal and market implications, particularly with respect to producer viability, import substitution, and broader macro-economic stability objectives," Guvamatanga noted in the letter.

Treasury also endorsed maintaining a wheat blending ratio of 70 percent locally produced soft wheat and 30 percent imported hard wheat.

While describing the arrangement as broadly neutral to domestic price stability, Treasury stated that imports exceeding prescribed thresholds should attract an appropriate levy or charge to ensure fair competition between imported and locally produced commodities.

The ministry formally designated the Agricultural Marketing Authority (AMA) as the collecting agent responsible for administering the levy at the permit issuance stage.

Revenue collected under the framework will be paid into the Consolidated Revenue Fund and, subject to parliamentary appropriation, channelled toward farmer payments through the Grain Marketing Board (GMB) and the development of smallholder irrigation schemes.

To strengthen accountability, Treasury has directed that monthly reports detailing levy collections, import volumes and fund utilisation be submitted for monitoring and transparency purposes.

The latest communication appears to represent a significant shift from Treasury's earlier position.

In March, Guvamatanga advised the Office of the President and Cabinet that SI 87 of 2025 was potentially ultra vires and should be repealed, citing legal concerns that the levy resembled an import duty imposed outside the framework of the Customs and Excise Act.

Treasury's concerns were based on legal advice from the Attorney General's Office, which reportedly argued that the statutory instrument exceeded powers granted under the AMA Act and conflicted with Section 298(2) of the Constitution.

However, Government's latest approach suggests that authorities are seeking to preserve the broader policy objective while addressing legal and administrative concerns raised in the earlier opinion.

The issue has now moved into the courts after GMAZ, led by its chairman Tafadzwa Musarara, filed legal proceedings challenging the levy framework.

The association cited several Government institutions as respondents, including the AMA, the Ministers of Agriculture, Finance, Justice and Industry and Commerce, the Zimbabwe Revenue Authority (Zimra), the Zimbabwe National Statistics Agency (ZimStat) and the Attorney General.

However, legal experts familiar with the legislation argue that the challenge overlooks provisions within the Agricultural Marketing Authority Act that expressly empower Government to impose and collect levies in support of agricultural development, food security and farmer support programmes.

According to legal analysts, the Act's preamble specifically provides for the imposition and collection of levies on producers, buyers and processors of agricultural products, as well as the administration of funds collected under the framework.

Experts further argue that Section 5(1) of the Act grants the authority broad powers to implement measures designed to stabilise and develop the agricultural sector.

Supporters of the levy framework say the measures form part of a wider import substitution strategy aimed at strengthening domestic grain and oilseed production, protecting local farmers and financing irrigation infrastructure critical to long-term food security.

The policy aligns with Government's economic development priorities under the National Development Strategies and Vision 2030, which seek to reduce dependence on imports and expand local production capacity.

Authorities estimate that Zimbabwe imports more than US$4 billion worth of goods annually, including products that can potentially be produced domestically.

Farmer unions and agricultural stakeholders have increasingly backed the levy programme, arguing that stronger producer prices, guaranteed markets and expanded irrigation infrastructure are essential for stabilising rural incomes and building resilience against recurring droughts and climate-related shocks.

Government officials report that approximately US$5.7 million has already been raised through the levy framework, with part of the funds being directed toward irrigation projects in several provinces.

President Emmerson Mnangagwa recently defended the broader localisation agenda during the 392nd Ordinary Session of the Politburo, saying Zimbabwe was repositioning itself within global value chains as a producer of value-added goods rather than remaining dependent on imports.

Vice President Constantino Chiwenga has also championed import substitution and industrialisation policies, arguing that economic transformation depends on building competitive domestic industries capable of reducing imports and increasing exports.

Meanwhile, Jacob Mudenda has repeatedly warned that Zimbabwe's growing import bill is draining foreign currency reserves and undermining industrial growth.

Despite growing support from farmers and policymakers, the levy framework remains contentious among some millers and processors who argue that the measures increase costs and constrain access to imported grain.

Supporters, however, maintain that the levies are necessary to rebuild local agricultural capacity, strengthen food security and reduce Zimbabwe's long-term reliance on imports.