‘Ar­bi­trary rules cause headaches for busi­nesses’

Lesotho Times - - Big Interview -

They should have clearly ex­plained to us how we would deal with the mat­ter,” said the dealer who re­quested anonymity.

Another trader added: “the sys­tem at the bor­der is al­ready a mess so this means more con­ges­tion as it will make the queues even longer.”

Last week, car im­porters and clear­ing agen­cies told this pub­li­ca­tion that the LRA had in­tro­duced a new clear­ing sys­tem at ports of en­try which they said had not only in­creased tar­iffs but was also tak­ing longer to process.

Some of the car deal­ers said they were now pay­ing 60 per­cent more in im­port du­ties as a re­sult of the new LRA reg­u­la­tions.

Three clear­ing agen­cies who im­port pre-owned cars from Ja­pan told the Leso

tho Times in sep­a­rate in­ter­views that the new clear­ing sys­tem, which they say was in­tro­duced with­out prior con­sul­ta­tions by the LRA in De­cem­ber 2017, had also bred mis­trust as clients blamed them for the re­sul­tant de­lays in re­ceiv­ing their im­ported ve­hi­cles.

Ac­cord­ing to Mokhali Mo­fu­bet­soana, a Phoka Clear­ing and For­ward­ing Agency rep­re­sen­ta­tive, the clear­ing of cars which used to be done be­fore the ve­hi­cles reached the bor­der was now be­ing done only when they had ar­rived at the bor­der and they were be­ing charged higher taxes.

“We nor­mally do pre-clear­ance but early in De­cem­ber they (LRA) in­tro­duced what they call top-up where they eval­u­ate the im­ported cars again when they ar­rive at the bor­der and then add an ex­tra charge,” Mr Mo­fu­bet­soana said.

“The changes were not com­mu­ni­cated to us be­fore­hand so we do not know the ba­sis for the higher taxes. The ex­tra charges have neg­a­tively af­fected our busi­ness in that we can no longer give peo­ple the ex­act quotes which let them know ex­actly how much it will cost them to im­port cars from Ja­pan,” he said.

How­ever, the LRA Cus­toms Com­mis­sioner, Kali Lepholisa, de­fended the new reg­u­la­tions, say­ing they were in­tro­duced after the LRA en­coun­tered prob­lems with the South African Rev­enue Ser­vices (SARS) in claim­ing taxes that were paid in South Africa.

“We have a Me­moran­dum of Un­der­stand­ing with SARS to re­fund us on VAT which was paid to South African sup­plies for goods ex­ported to Le­sotho and we de­mand those re­funds based on the in­voices which would be used to clear goods at the bor­der,” she said.

“How­ever, SARS has ex­plained that they have been hav­ing prob­lems of goods bought on credit in that they would have re­funded us and yet they never get the tax from those sup­pli­ers. So to avoid that high risk, VAT will from 1 Fe­bru­ary 2018, be de­manded at the Le­sotho bor­ders for goods bought on credit.

“The lo­cal traders have the op­tion to ask their sup­pli­ers to give them a zero tax rate on the in­voices so that they do not get to pay tax twice or they can ar­range with LRA to have a de­fer­ment ac­count which will al­low them to pay tax at a later date after set­tling their debts with sup­pli­ers so that way they have the proof of pay­ment.”

She said the LRA will meet SARS on 8 Fe­bru­ary this year to fur­ther dis­cuss the is­sues raised by traders.

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