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Set compliance guidelines on tax relief, ZAM challenges govt

Set compliance guidelines on tax relief, ZAM challenges govt
By Kabanda Chulu
Wed 13 Jan. 2010, 04:00 CAT

THE Zambia Association of Manufacturers (ZAM) has challenged the government to set compliance guidelines whenever tax relief is given so that investors can be obliged to pass on benefits to consumers.

The government has given various tax incentives to foreign investors, especially the mines and companies intending to operate in the proposed Multi Facility Economic Zones (MFEZ), ranging from tax relief on capital equipment, increased number of expatriates, extended periods of when to start paying certain taxes, among other incentives.

But ZAM has argued that there must be compliance guidelines in place since investors did not pass benefits to local people despite producing goods and services at lower costs due to the incentives given.

“There must be an effective system to monitor whether foreign investors are passing on benefits to consumers or not since they have tax relief and various incentives aimed at producing at lower cost,” stated ZAM. “So government should establish compliance guidelines whenever tax relief is given so that businesses are obliged to pass on something to consumers.”

Despite embarking on various reforms aimed at reducing the cost of doing business that have also resulted in Zambia improving its rankings by 10 on the World Bank Doing Business Index, Zambia still remains an expensive country to operate from in terms of producing goods and services.

Labels: MANUFACTURING, MFEZ, ZAM

posted by MrK @ 6:54 AM