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(TIMES ZM) Varun tax holiday was illegal, says Yamba?

Varun tax holiday was illegal, says Yamba?

SECRETARY to the Treasury Fredson Yamba has submitted to the Lusaka High Court?that the five-year tax holiday given to Varun Beverages Limited by former Finance minister Situmbeko Musokotwane was illegal.?

This is in a matter in which Varun Beverages has contested the cancellation of a tax deferment. The company has argued that Section 56 of the ZDA Act empowered a company with an investment of more than US$500 000 to enjoy tax exemption.?

In his affidavit in opposing, the application for leave for judicial review filed on March 6, 2012, Mr Yamba stated that the tax deferment was not based on any provision of the law.

The submission was made before High Court Judge Anesi Bobo- Banda.?Mr Yamba, of House Number Nine Njoka, Road in Olympia Park in Lusaka?said he had read the affidavit by Varun in which the company was seeking judicial review.

“On 7 May 2010, then minister of Finance and National Planning Dr Musokotwane did approve the deferment of value added tax and excise duty on the products of the applicant company and I am advised by the attorney general and verily believe the same was not based on any provisions of the present law,” Mr Yamba.?

When the matter came up for inter-parte hearing in chambers yesterday, one of the lawyers representing Varun, Mr Mulenga Mundashi sought an adjournment.

He said his team could not respond to the State’s opposition because they had just been saved with the response and that they needed time to consult their client before responding.

Varun Beverage is seeking a court order to quash the Government’s decision to revoke its five-year tax deferment.

The beverage company has contended that the revocation was in defiance of the rule of natural justice as the firm was not accorded an opportunity to be heard before the action was taken.

Varun Beverages, the maker of Pepsi, has also stated that the verdict was tainted with procedural impropriety as it was not given a chance to make submissions before the Zambia Revenue Authority (ZRA) Commission of Inquiry which recommended the revocation of the tax deferment.

Varun Beverages had argued that it had legitimate expectation to continue to enjoy the tax relief following its investment of US$44, 197, 000.

Varun beverage was given a five-year tax deferment by the previous regime in 2010 which has now been revoked by the Patriotic Front Government.

Labels: SITUMBEKO MUSOKOTWANE

posted by MrK @ 6:26 AM