Duty on bus kits cut to 10pc

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Stakeholders in the transport industry have welcomed the Government’s decision to cut to 10 percent import duty on semi-knocked down kits used in assembling buses, saying this will reduce the cost of the vehicles locally, save foreign currency and create jobs.

Stakeholders said cheaper buses would see commuter fares remaining stable with a reduction in prices across the value chain.

The notice of the suspension of the duty is contained in Statutory Instrument (SI) 8 of 2020 published in the Government Gazette last Friday.

The SI was published by Finance and Economic Development Minister Professor Mthuli Ncube.
“It is hereby notified that the Minister of Finance and Economic Development has, in terms of section 235 of the Customs and Excise Act, made the following regulations; (1) These regulations may be cited as the Customs and Excise (Suspension) (Amendment) Regulations 2020 (No.225),” said Prof Ncube.

He said the reduction of the duty would only benefit those that assembled buses locally.

Reads section 9 (2) of the new regulations: “Customs duty is suspended to rate of duty of 10 percent on semi-knocked down bus kits imported or taken out of bond by an approved assembler for use in the assembly of buses in terms of this section. (3) No suspension of duty shall be granted on completely built up bus bodies. (4) Any person who wishes to claim a suspension of duty in terms of this section shall apply to the proper officer in the form approved by the Commissioner for registration as an assembler.”

AVM Africa managing director Mr Jacob Kupa said as bus manufacturers, they welcomed the decision by the Government as this would lead to a reduction in prices across the value chain.

“We would have preferred further reduction but this is a welcome development,” said Mr Kupa.
The Zimbabwe Passenger Transport Organisation (ZPTO), an umbrella body for public transport owners, said Government’s move was a positive development for the industry.

Said ZPTO secretary-general Mr Wilson Chibage: “The reduction is welcome and is a step in the right direction if we are to revive our local bus industry. At the moment, most operators are relying on imports that are very expensive and require hard currency.

“There is no local bus assembly plant to talk about at the moment, so reduction of duties will go a long way towards the revival of that industry and the creation of jobs.”

Most operators are importing buses from China for between US$85 000 and US$150 000.

Willowvale Body Engineering operations manager Mr Silvester Matambo said while the decision was welcome, Government should consider incentivising other players in the bus industry.

“This is a good development but we think Government should also look at players like us who import chassis from South Africa.

“At the moment we are not included in these tax incentives although we have a big role to play in the revival of the industry,” said Mr Matambo. – Herald