‘Im­port tax re­bates un­der­utilised’

Lesotho Times - - Business - Bereng Mpaki

LO­CAL busi­nesses have been urged to make use of im­port tax re­bates to re­duce op­er­a­tional costs and stim­u­late eco­nomic growth.

Ac­cord­ing to the Min­istry of Trade and In­dus­try’s Tar­iff In­ves­ti­ga­tion Man­ager, Kekeletso Tsumane, most busi­nesses in Le­sotho did not ap­ply for im­port tax re­bates with the ex­cep­tion large tex­tile gar­ments man­u­fac­tur­ers.

She said the im­port tax re­bates were ef­fected to stim­u­late eco­nomic growth and com­pet­i­tive­ness, adding they were avail­able for most goods im­ported for busi­ness pur­poses. Im­port duty is tax payable on im­ported goods, and among other pur­poses, is meant to pro­tect the im­port­ing coun­try’s in­dus­try if it is pro­duc­ing sim­i­lar goods.

Ms Tsumane said by not mak­ing use of the re­bates, many lo­cal busi­nesses im­port­ing raw ma­te­ri­als from out­side of the South African Cus­toms Union (SACU) re­gion were in­cur­ring higher pro­duc­tion costs than nec­es­sary. SACU is the world’s old­est cus­toms union and con­sists of Botswana, Le­sotho, Namibia, South Africa, and Swazi­land.

“A re­bate is a tax in­cen­tive given by the gov­ern­ment to im­porters for goods that are meant for pro­duc­tion. Al­though re­bates can be im­posed for many rea­sons, they are fun­da­men­tally in­tended to en­cour­age trade in the coun­try and en­hance its com­pet­i­tive­ness through re­duc­tion of op­er­a­tional costs,” said Ms Tsumane in an in­ter­view with the Le­sotho Times this week

“By re­duc­ing op­er­a­tional costs, im­porters are able to in­crease their pro­duc­tion base and hire more peo­ple in the process.”

She said her of­fice was con­cerned with the slow up­take of im­porters in ap­ply­ing for re­bates al­though the in­cen­tive ap­plied to al­most any goods im­ported from out­side of SACU for busi­ness pur­poses.

“We have noted with con­cern that most of our im­port­ing pro­duc­ers don’t make use of the re­bates which would help to re­duce their op­er­a­tional costs,” Ms Tsumane said.

“Re­bates can ap­ply to most goods im­ported from out­side of SACU, al­though many such goods are not listed in the Tar­iff Book.”

She said her de­part­ment would soon em­bark on pub­licblic aware­ness cam­paigns about re­bates.

“In the past, we have been dis­sem­i­nat­ing in­for­ma­tion­tion on re­bates through the me­dia. How­ever,wever, we want to in­ten­sify th­ese ef­fort­sts to en­sure more peo­ple come for­wardrd to ap­ply for re­bates,” added Ms Tsumane.mane.

Le­sotho Cham­ber mber of Com­merce and In­dus­try Sec­re­tary-gen­eral tary-gen­eral Fako Hakane echoed the he sen­ti­ment, say­ing few of their mem­ber­srs knew about re­bates.

“It would not ot be cor­rect to say all our mem­bers are aware of the re­bates on im­port du­ties.es. Very few know about re­bates. For in­stance, stance, a com­pany that spon­sors sport has a re­bate that most ost of our en­trepreneurs don’t know about,” said Mr Hakane.

“So, I be­lievee ed­u­ca­tion on re­bates s should be an on­go­ingg thing rather than just st be­ing a once-off ex­er­cise.”cise.”

Le­sotho Cham­ber of Com­merce and In­dus­try sec­re­tary-gen­eral Fako hakane.

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