Lusaka, Monday (June 10, 2024)
The Zambia Association of Manufacturers (ZAM) has made a strong appeal to the government to expedite the process of Value Added Tax (VAT) refunds for manufacturers who consistently comply with tax regulations.
During the 2024 pre-budget meeting held at the Intercontinental Hotel in Lusaka, ZAM President Ashu Sagar emphasized the importance of establishing a scorecard system.
He said the system would prioritize compliant manufacturers for VAT refunds and other tax-related reimbursements.
Mr Sagar further proposed significant tax reforms, including a reduction in Income Tax rates for manufacturers serving both domestic and export markets from 20% and 10%, respectively, to 16% to 14%.
He said the move is to alleviate the burden of value-added goods and services and to prevent the accumulation of refund claims.
The ZAM President also recommended an extension of the timeframe for presenting proof of exportation under VAT Rule 18 from the current 3 months to 6 months.
He also called for an increase in the Turnover Tax (TOT) threshold from K800,000 to align with the Micro, Small, and Medium Enterprises (MSME) Classification.
Mr Sagar urged the government to standardize and consolidate council levies under a single overseeing ministry and to develop regulations for product listings in chain stores.
“We call for increased funding for the Department of Veterinary Services to enhance their capacity to combat livestock diseases,” he said.
Meanwhile, Mr Sagar advocated for the recognition of recycling as a priority sector within the economy.
Addressing the performance of the manufacturing sector, Mr Sagar noted that it has been inadequate in driving rapid economic growth.
He observed that the value-added growth in manufacturing has been reflecting the slowing trends of the broader economy over the past decade.
Mr Sagar suggested strengthening existing incentive frameworks and optimizing tax structures to improve the sector’s performance.
“These measures will provide the necessary support for the manufacturing sector to flourish,” he said.
This is contained in a statement issued by ZAM Chief Executive Officer, Muntanga Lindunda.
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