Copper Exporters Get Tax Refund in Zambia
August 27, 2014 Taxation in Zambia
On August 26th the Finance Minister of Zambia Alexander Chikwanda announced that the government would relax the rules applied to copper exporters, a move that will lead to the repayment of more than USD 600 million of previously withheld VAT refunds from the government to copper exporters.
Previously the government required all copper exporters to produce import certificates from the destination countries to which the metal was headed, and failure to produce the required certificates could result in penalties or a withholding of any tax refunds.
Copper exporters facing the documentary requirements claimed that the need to produce the certificates was too onerous a task, which inhibited business growth.
The government claimed that the requirement was intended to curb the occurrence of tax avoidance, which is estimated to have a significant negative impact on the country.
However, the Finance Minister has now conceded that the requirement was impractical, in turn slowing down the economy and tax collections, as exporters reduced their own business activities.
The tax refunds will be staggered, and are expected to start tomorrow.
Photo By: Peter B. Carter