Tax relief for business
REGISTERED and tax-compliant businesses in the four productive sectors that do not increase prices beyond those prevailing before Saturday will be eligible for tax relief on the higher excise duties charged for fuel so long as they can show the fuel was used for productive purposes, Minister of Finance and Economic Development Prof Mthuli Ncube said last night.
In a statement following up on the announcement by President Mnangagwa on Saturday of new fuel prices to curb wasteful usage compounded by rampant illegal currency and fuel trading activities, Prof Ncube said:
“Cognisant of the need to prevent generalised price increases for goods and services following the fuel price adjustments, Government has decided to provide relief through refund of excise duty on fuel consumed by registered businesses in the following sectors: Manufacturing; mining; agriculture and transport.
“The relief to be provided will be equivalent to the difference between the prevailing rates of excise duty and the rates that were applicable prior to this change.”
Benefiting businesses had, said the minister, to meet four criteria: ◆ The prices of goods and services by beneficiaries should not have increased relative the latest change in the price of fuel; ◆ The beneficiaries should be registered and compliant for tax purposes; Beneficiaries should be members of recognised business associations and, ◆ Beneficiaries should provide evidence of the productive use of the fuel. “Consultative engagements will be held with the respective sectors, responsible Ministries and the regulatory authorities, with a view to determining modalities of implementing the relief. Measures will also be put in place to provide for the smooth implementation of the relief during the transitional period,” read part of the statement.
But the minister warned cheaters: “Any abuse through misrepresentations of facts with a view
to benefiting from the facility will result in denial of use of the facility, and imposition of a penalty.
“Furthermore, Government would want to urge all business leaders to desist from any form of rampant market indiscipline, and is concerned with the recent unjustified prices increases, which serve to undermine Government efforts to restore macroeconomic stability.”
Prof Ncube urged businesses, in the spirit of working together, to
complement Government efforts to revive the economy by “refraining from any counter-productive measures such as wanton price hikes”.
He added: “In this regard, all those who have increased their prices since the latest fuel price review should revert to the pre12 January, 2019 prices, given that Government has already put in place a price adjustment compensatory framework through refunds.”