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Millions lost to smuggling of onions apples

Millions lost to smuggling of onions apples

CAPETWON: Sumggling of onion and apples from South Africa is depriving the fiscus of millions of dollars worth of potential tax revenue, the Fresh Produce Marketers’ Association of Zimbabwe has said.

“Currently, the manner in which production, importation and marketing of fresh produce, particularly apples and onions, is creating an uneven playing field and prejudicing the fiscus,” Mushori told stakeholders at a consultation workshop on strategies to revive the horticulture sector on Wednesday.

The government has put a 25% surtax on apples and onions to protect the local industry. However, the country does not produce enough apples to satisfy local demand. “The 25% surtax has resulted in loss of revenue to central government because the informal traders do not pay taxes, as they transact on a cash basis. The 25% surtax motivates traders to take the risk of smuggling with an estimated 32 000 tonnes of apples coming through the border at a value of about $35,2 million. The government is being prejudiced of 25% of this value,” Mushori said.

The country produces at least 4 000 tonnes of apples against a demand of 35 000 tonnes. Mushori said while registered companies pay the full 25% of the invoice value and meet other statutory obligations, informal traders do not pay the surtax and other obligations.