Government has lifted the tax exemption for Public Benefit Organisations and other Non- Governmental Organisations.
This follows Minister of Finance Alexander Chikwanda signing Statutory Instrument (SI) No. 103 of 2013 which has brought into effect the Customs and Excise,
Public Benefit Organisation Amendment Regulations.
According to a press statement issued by Ministry of Finance Public Relations Officer Chileshe Kandeta, the SI is effective 8th November 2013.
The statement further says that this means all motor vehicles and spare parts for motor vehicles imported by Public Benefit Organisations shall no longer qualify for tax exemption.
Other goods which will no longer qualify for tax exemption under the Public Benefit Organisation Scheme include wines, except sacramental wine imported by a religious body or Church, other alcoholic beverages and all household goods except beds and mattresses.
Linen, kitchen equipment, tobacco products and goods whose value is equivalent to a travellers allowance remission under Customs and Excise Regulations SI 54 of 2000 will also not be exempted from tax.
And Mr Kandeta says Secretary to the Treasury Fredson Yamba is concerned that some Public Benefit Organisations have been profiting from the tax exemption by selling tax exempted goods without the approval of the Commissioner General of the Zambia Revenue Authority.
Mr Yamba said under SI No. 103 of 2013, it is an offence for any organisation to violate the provisions under which existing tax exemption incentives have been granted.
He said organisations that shall violate the SI will face sanctions.
Mr Kandeta said this move has come after the Ministry of Finance reviewed SI No. 7 of 2009 under the Customs and Excise, Public Benefit Organisations, Rebate, Refund or Remission Regulations in order to streamline exemptions provided to Public Benefit Organisations.
He said during the presentation of the 2014 National budget to Parliament in October this year, Mr Chikwanda announced that government had undertaken a review of tax incentive regimes in order to rationalise tax incentives as part of the tax reform process.
I have always been critical of this gvt, but on this one iam on your side mr chikwanda.
Its ironic that sacramental wine is exempted, now which faith uses it again? And which church does Chikwanda and Sata go to?
Im 50/50 on this one so many pros and cons…mmmmmm
@Jay Jay, why you didn’t comment under my comment, again? Just humble yourself, you are welcome.
Anyway, Sata & Ba Chikwanda (I can’t call him Ba Sata) they USED to go to Catholic church.
@jay jay.the folowing churches apart katolika uses sacramental wine-lutheran church of central africa,sda,aglican,usz,jahovah’s witness etc what do you now say?
Good idea but I am deeply worried about the selective implementation of such instruments by the PF.
Very soon Political parties will told to pay income tax as well.
@gaanja farmer,sda church dont use sacramental wine bt makes its own wine for holy communion locally which is alcohol free (not fermentd)
Patriotic Front President Michael Sata has declared 7 guns worth K26 000 , a Cresida Motor Vehicle valued at K15 000 and 20 000 shares in Chilanga Cement valued at K150 000
Now we need to know how much he has.
The have forgotten!
Not fair, why leave out Mahule.
I was almost screaming that our Catholic wine, blood of Christ (Ndifai) will be taxed too, just because Sata is barred from holy communion.
@Nostradamus
The chitimukulu trying his best to cool down GBM… because when GBM loses his cool, mealie meal price will go up.,, everyone will be affected and the whole country will riot, No amount of tax benefit will help..
Please Nostradamus can you phone your uncle,, abantu balachula,, But Sata..awe shula.
@Ndobo, Sata is not my uncle, he is Miles Sampa’s uncle. Ba Kilistina was boyfriend, if not wife of my uncle… anyway, its a family secret.
The only person who can cool-down GBM is the ShiLubemba Chikwanda, the uncle of Sata. By-the-way, Ba Chikwanda has ka share in Arizona Transportation whose owner is GBM.
Its a mess Ba Ndobo, a total mess…
One accountant from an ophanage narreted to me how his director, a prominant Bishop and vocal who runs that facility was minting money.When his friends imported cars he claimed they were for the facility yet they were for his friends businesses.
Why did not report the matter to ACC instead of talking to you?
An organisation called DAPP brings in second hand clothes duty free on the pretex of a public benefit organisation. Why does the government allow them to sell such clothes to the public.A typical case of abuse. The government should also consider the abuse currently happening under regulation 85 Statutory Instrument No.54 of 2000 ( Customs Act). Returning students with no capacity to buy vehicles have being conniving with relatives and freinds to bring in brand new vehicles.
In all honesty do you need an SI for this; what ever happened to commonsense!!
Expansion of revenue base in a decent government is always something to celebrate about but not with the Sata administration. We now know that fiscal discipline is foreign to Chikwanda and his greedy leader, chief Kaponya -CNP. They are sinking this economy faster than anyone envisaged, small tax revenues such as these are quickly swallowed up in perpetual by-elections, misuse of public resources(deployment forces to suppress individual freedoms), bloated cabinet and unbudgeted for infrastructure projects that could easily be done away with if a fraction is spent on modernising existing ones.For every ngwee raised, Chikwanda sees an opportunity to go for Kaloba in the hope of earning himself commission. You cannot fool us anymore.
Zonda Uzalema mambala iwe hehehe
This is hole rible
GBM’s transport company’s contract with FRA revoked. GBM promises to take on Mr Sata. Tulemonako nomba!
MMD made that stupid mistake and they ended up paying him three times. That is the money that boosted GBM ‘s financial standing.
He is not worried. If he wants money he can sublet those trucks to some one else who will the business on his behalf.
Either way GBM is gaining while PF are loosing. Now with such actions GBM will go balistic and expose Sata and his dealings.
Looking forward to hear GBM confirm Sata ‘s dodgy schemes I have known for years.
Gadaffi, Mobuto, Idi Amini. Saddam, Taylor, are in the same cohort with Sata. What ever happened to all these guys shall surely happen to Sata.
And the taxpayer foots the bill in the end for breach of contract and also pays again for hiring another hauler…where is the nation’s interest in all this? Ain’t you the selfsame blogger who has been supporting this mediocrity all year round?
Nostradamus,
Call your Uncle Satan to deal with GMB well. After all he Satan is sick and always carrying urinal bag daily. Who will help him since Wynter too is on the list of those to join the world of the dead.
What?? Seriously, Kabimba is dying? No please, then PF will be boring, no dog bucking? God must save even the worst sinners, I pray for Kabimba, just as I prayed for his accused ex-girl-field Masebo. What did they eat those two to get that sick?
GRZ use your noggins please. Civilised countries require ALL organisations to submit returns that include professionally audited financial statements. Most of these fly by night, Faster Pastor, churches and NGOs need this regulation enforced.
These priests, Bishops, pastors, apostles and such con farts need to be sanitised.
Chaps and wenches whose only claim to fame is being able to recite Holy verses. They walk around in $300 suits and designer shoes. They boast of their designer cologne and USA trips.
Get them documented and publised.
This is treating a symptom by eliminating the visual effect of the symptom and in the process killing more body cells than there was a problem in the first place. A few crooks do not call for a solution which destroys a system which helps the people. Its like saying government are corrupt thieves through who give their own companies and those of their relatives tenders, so let us abolish government.
Law enforcement should prosecute those found wanting instead of punishing the entire movement, most of which does really beneficial work for the people, the poor people this government wants to call itself pro-poor about.
From wage freeze to this! people wake up,these madalas have hit rock bottom,time for fresh minds.You have depleted all resources by borrowing heavilly
Spot on!!
Where do we have more incentives? in the mines or in this Church/NGO sector? and who does these incentives benefit? Individuals or public? . I will not be surprised to hear that NGO’s have been banned from operating in ZED!
At the rate our “broke government” is acting, I won’t be surprised if the incentive extended to returning citizens is completely scrapped off. Currently returning citizens who’ve been resident in foreign countries for more than 2 years, upon return to Zambia, are allowed to come into the country with one car and household goods duty free. I am seeing this being scrapped off very soon.
Help me understand, wat if in the 3 yrs I have been away, I came back to Zed 2 times for 3 weeks holiday, will I still enjoy de exemption wen I finally return?
Yes, you will still enjoy the exemption, no worries!!
@Namona: Yes you still enjoy your tax exemption on your return because short holidays will not affect your residence abroad.
To make things easier easier or to put your mind at rest, you can get a letter from the Zambian Embassy in that country to confirm that you are return citizen. That’s straight forward and embassies are always very helpful!
@chosen one & chilyata, Thanks a lot for de clarification.
If you soak some raisin in water will it turn back into grape? If not,then ba Chikwanda as a catholic you’re implementing a self defeating and ruinous policy.
Now this is desperation of huge magnitude! The incompetent Chikanda is now aiming at soft targets like NGOs and Churches leaving the Mines and Companies like Zambia Sugar that are evading taxes willy nilly!
There is not much tax he is going to get from NGOs or Churches. In fact many NGOs will now leave Zambia and take their aid to countries like Kenya, South Africa and India. Even 10% of British Tax Payer’s money being paid to Zambian Taxes will be unaceptable because this is money not going directly to buy Food, Water Equipment, Medicines, etc.
It’s not like International NGOs are getting anything – so they lose nothing. What does Bill Gates gain from donating ARVs & Field operations vehicles – absolutely nothing. If you decide to tax him he will simply go to help Zimbabwe, Kenya,…
Zonda Uzalema iwe kabova
Well stated Chilyata,you make alot of sense.
Hey
One thing that shud b realised is dat most of the big NGOs get fundin from delopment agencies for developed countries such as USAID, DFID, CIDA, DANNIDA, etc. The moneys from these devt agencies is taxes from employees of those countries who want to help poor countries like Zambia. Now, if we subject tax payers money to tax which is meant to help our people, it means that the donors may withdraw funding and take it to countries which have do not subject tax payers’ money to tax. The reason is simple, the beneficiary govt shud show commitment to the awarded grant and one way to show that commitment is by exempting taxes for goods and servicesm
Thanks
We are being led by villagers with scant knowledge of budgetting process,expenditure framework and the role of tax exempt NGO’s.No wonder all they have achieved after all 30yrs in govt is 7guns and a cressida.
Patriotic Front President Michael Sata has declared 7 guns worth K26 million , a Cresida Motor Vehicle valued at K15 million and 20 000 shares in Chilanga Cement valued at K150 millio
What an unreasonable move. Who chose this guy? Taxing public benefit organizations is a sure way of closing all the possible channels to help the most vulnerable. So orphanages can’t buy or receive donated bed sheets and blankets without being taxed? When a govt is failing to meet the needs of its citizens, you now target the very institutions that are a source if help. Awe this govt is full of ifikopo. No brains… All the international aid will just be diverted to our neighboring countries.
Kanjimaano said:
August 14, 2011
The only foolishness inhere is giving licences to one person to own 7 guns. Whats that for??? Mambala > funding criminals.
Certainly NGOs should account to the people of Zambia. This happens in all countries especially the developed world. However, taxation should be carefully and dilligently administered in such a manner that they are not treated unfairly. In developed countries any monies spent on helping the vulnerable/poor/underprivileged is exempt from tax. In the West, money paid as offering and tithe to registered religious organisations is deducted from income before taxation. This principle applies to both individuals and organisations. Certainly donors to charities/NGOs working in countries that tax such incomes will reconsider their support to such NGOs. I hope the economists in the Ministry of Finance made a holistic analysis of this measure before asking Cabinet to approve it. Very sensitive.
@Let me say this: You seem to be confusing yourself within what you are saying.
Let me be categorical and clear on this point is leave out your waffle!
1. Western Countries DONT TAX Registered Charities, NGOs, Churches or so called Public Good Entities.
2. In fact, Western Countries dont only charge corporate taxes or duties, they even pay back VAT incurred by charities through partial full recovery schemes
3. To encourage people to donate to NGOs, the UK Government gives 21% for every donation made by a Tax Payer under the Gift Aid Scheme. So, instead of Taxing, the Zambian Govt should be giving back the Income Tax suffered by a tax payer on the donation made to a Charity or NGO.
How about that?
This govt is just broke and they want every kwacha from the poor. Bi elections and big cabinet is needing finances.
I guess constant by electioneering,the gazzilion deputy ministers,dozens of more universities and districts plus the reckless march again towards HIPC status is taking its toll on PF govt ‘s finances.You’ll now be taxed to breath.
Educate me here: What financial prudence is there when organisations depreciate assets mainly motor vehicles after 3 to 5 years and then make a profit by selling them by tender to highest bidder or at market value.
TARINO, ARE BOTH YOURNPARENTS PF CADRES? WHY ARE YOU SO RETARDED IN YOIUR REASONING? YABA, NICHOKAKO WEKA ABA ABANA BA MA CADRES BALISHUPA.!
Good move Chikwanda!
@ Kapuli Wang’ongo. When NGOs buy vehicles or any other asset that is exempt from tax, they are to have that asset not sold until after five years. if an asset (a vehicle) for example is sold before five years, ZRA will have to calculate the duty of the vehicle at the time of sale. so the government does not loose anything if a vehicle is sold before 5 years. now the issue of having people bid for assets and selling them at market price. NGOs will have the scrap value of an asset such as a vehicle before auctioning it. The money realized from that asset is used to give bonuses and other additional incentives to staff, so when they get more money from an asset it means that they have more money in the reserves which the can use for activities such as increased performance bonuse.
Thanks
There is only one thing this policy is targeting earning from other people’s tax, which is economically wrong and this will only reduce the in flow of help from other countries. All these are signs that Chikwanda is failing to balance his books of accounts, especially that trade deficient is slowly kicking.
No doubt that Chikwanda has lamentably failed to run our treasury as effeiciently as Situmbeko and Magande did but that’s not the end of the story!
The whole PF Government especially SataN has failed to manage the country.
This will hurt the economy and people even more than the removal of subsidies – wait and see!
What constitute a Public benefit organisation? Should churches like Bread of Life, Jehovah’s witness, Life Gospel fellowship, Northmead Assembles of God and many pentecoastal ministries established in kwa … areas be classified as Public benefit organisation? What do the general public benefit from these churches? Nothing, infact pastors from some of these pentecostal ministries and cult organisations have being reaping massively from the poor. They demand for hefty tithes from the poor tells it all. I stand to be corrected, do these pentecoatal ministries and other cult organisations run any projects, schools, hospitals, hospices, orphanages or feeding centres where the poor can benefit from? What we see is the opposite- big houses, foreign holiday trips, lastest cars, helicopters
Ho!ho!ho! happy holidays brethrens. I am back with a bang! Just returned from Zamunda were I noticed a lot of roadworks being done. The whole of the Lusaka-Mazabuka road is being widened and smoothened to the quality of whoosh as you drive along! That to me is a plus. Not so sure whether it will be a dual carriage way at this point in time and if one knows let us know plz. Zamunda looked progressive and some of the negative innuendos I read here did not suffice whilst I was there. There was tranquility and people went along with their daily lives without much of a fuss. Zamunda is full of people whom I call opportunists. When you land there, relatives and friends make you the deal – in short, they want to rip you off! Tell them your goods are still in transist and you need local cash…..
….at the mention of local currency, they leave you alone in their droves! It would be laughable if it wasn’t sad. The genuine ones and believe me you that they are few and far between will stick around and over you a beer or two. Look after them once you have settled down unlike the usual leeches that should be shunned forever – the good for nothing freeloaders!!!!
^^^ offer you a beer or two^^^^
why my old name is showing…. ok, one hit wonder is synonymous with confused.com and I am one and the same. let me sort out the pseudonyms in a little while…..cool
But the foreigners called investors are still enjoying tax holidays and rebates.
What a Christmas gift for the orphans and vulnerable families and children. Our government leaders have no idea what contribution churches and NGOs are making to chronically ill people, to children who cannot afford high school fees or shoes to attend school. This decision is meant to punish one or two institutions and the expense of hundreds of churches and NGOs that are doing commendable work. We pray that this decision will be reversed.
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