Posted by @thecustomsguru on Thur 28 Feb 2019
The monetary policy statement has set into motion a series of events that most likely going to affect importation of goods. The Reserve Bank of Zimbabwe recently re-denominated bond notes, bond coins and RTGS balances (electronic money) to RTGS dollars. This made the RTGS dollars formally exchangeable with US dollars and other foreign currencies.
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There is high chance that the introduction is most likely going to increase the amount of duties people are currently paying. The most probable reason for this is that all along the Value for Duty Purposes (VDP) Zimra uses to calculate duty has always been denominated in USD dollars and people were told to swipe or pay with ecocash their duty payments if the goods were exempt from paying hard foreign currency.
Now that everything in Zimbabwe has been denominated in RTGS dollars it follows also that the Value for Duty Purposes used in the calculation of duty has to be denominated in RTGS dollars using a rate of exchange of 1USD to 2.50 RTGS dollars. The effect will increase duty by the said exchange rate.
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Let me give an illustration:
Before re-denomination
Importing a gas stove costing around USD200 from South Africa, the VDP on this stove would be normally be USD 210. Zimra would charge you a flat rate of duty of 40% and you would be asked to pay $84 which you would normally just swipe using your local Zimswitch linked bank card or simply pay using ecocash or just using the bond note.
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After re-denomination
After the VDP is denominated in RTGS dollars, this would be the scenario. The VDP of the gas stove would be 210 x RTGS 2.5 = RTGS 525. Paying a flat rate of 40% on the stove would see one paying RTGS 210. Well, this again one can either swipe, ecocash or pay using notes.
In essence, the duty has just shot up by 150%.
As of now (at the time of posting) this is purely just speculation but only time will tell. If you want to check the amount of duty you might be charged, click Duty Calculator link and you will be redirected to the duty calculator page.
3 replies on “Duty set to increase by 150% in RTGS dollars”
Even if the charges are high. We do understand that together . We can raise our economy. BUT why is it so hard that takes days to go back home with your products. Every process is juss stressful. With all the charges you give. Are we still failing to improve our systems and beitbridge,so that we have a good flow
Yah zvakaoma, I hope not
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