The Zambia Revenue Authority (ZRA) has introduced standard customs duty rates for imported used vehicles to eliminate inconsistencies which were shrouding the process in corruption.
ZRA Corporate Communications Manager Topsy Sikalinda disclosed in a statement Wednesday, that the introduction of standard duties would ensure predictable import and excise duties.
Sikalinda, however, stated that the taxation system for special purpose motor vehicles such as ambulances had not been changed and advised importers to make correct declarations, saying it would be a serious offence to cheat on the details of a vehicle in order to pay lower taxes.
“Specific import and excise duties have been introduced through the Customs and Excise Amendment Act No. 14 of 2017. The introduction of the noted specific duties was necessitated by a need for a transparent and predictable way of determining the import and excise duties on used motor vehicles. This measure will give power and control to the final owners of the vehicles by promoting transparency, uniformity, simplicity and by eliminating inconsistencies that have been fueling corruption in the process, as well as reduced dwell times at border crossings,” Sikalinda stated.
He guided that payment of duties through the new method had been split into two categories based on vehicle’s year of manufacture.
“The new standard predictable duty rates will help the final buyers plan for the import costs as well as assist the Customs Clearing Agents serve their clients better as the amounts to be paid will be known even before they import the vehicle. The new taxation method on used motor vehicles will also help standardise the collection of import duties on such vehicles implying that vehicles of the same body type and manufactured in the same year will attract the same amount of import duty regardless of the port of entry. For the new method to be fair, used motor vehicles have been split into two categories namely; aged 2-5 years above 5 years,” he stated.
“Further, the vehicles are identifiable by body type, fuel type, cylinder capacity, sitting capacity and tonnage. For example; buses will be identified according to seating capacity while sedans, hatchbacks, station wagons and SUVs will be identified according to engine capacity. Utility vehicles such as pick-ups, light trucks and heavy duty trucks will be identified according to tonnage.”
Meanwhile, Sikalinda stated that the taxation system for special purpose motor vehicles had not been changed.
“It is important to note that for brand new motor vehicles, special purpose motor vehicles, ambulances, prison vans, hearse, tractors and trailers, the taxation system remains as previously was before these tax changes. Importers are strongly advised to make correct declarations as it will be a serious offence to cheat on the details of the vehicle in order to pay lower taxes. Such vehicles will be seized and forfeited to the state. Importers are advised to plan for taxes even before they import since the payable taxes and duties are now predictable and in public domain,” stated Sikalinda.