By BUUMBA CHIMBULU
GOVERNMENT has offered tax relief to key economic sectors and will inject money in the economy to ease pressure caused by COVID-19 on businesses.
The State will release K2.5 billion to tackle liquidity challenges in the financial market and dismantle arrears.
Finance Minister, Bwalya Ng’andu, said yesterday in Lusaka that the measures were aimed at protecting the economy from the impact of COVID-19.
Among the measures were suspension of the five percent duty on the importation of copper concentrates as well as export duty on precious metals in the mining sector.
Dr Ng’andu said export duty on crocodile skin would also be waived.
The minister said the measures would take effect as soon as he signed the Statutory Instruments, which were currently on his desk.
Other taxes that would be suspended were excise duty on imported ethanol for use in alcohol-based sanitisers and other medicine related activities subject to guidelines to be issued by Zambia Revenue Authority.
“Government will also remove provisions of SI 90 relating to claim of Value Added Tax on imported spare parts, lubricants and stationery to ease pressure on companies,” Dr Ng’andu said.
Dr Ng’andu also said to support the easing of liquidity in the face of the adverse effects of COVID-19, Government would release K2.5 billion.
He explained that the money would be released as soon as the current verification exercise was concluded.
He also explained that the money was meant to reduce arrears owed to domestic suppliers of goods and services and outstanding arrears to pensioners under Public Service Pension Fund and retirees under Ministry of Justice.
Dr Ng’andu however said the portion to pay pensioners had already been authorised.
“The money will reduce outstanding third-party arrears and other employee related commitments. In addition, K140 million will be released to pay local contractors in the road sector,” he said.
The Minister emphasised that the measures he announced were the initial response to the impact of COVID-19.
Government, he said, may take additional measures to support the economy and respond specifically to the challenges the business community was facing as well as safeguard the financial sector, should the situation worsen.
“Government will continue to review developments as they unfold and take appropriate measures where necessary,” Dr Ng’andu said.
By BUUMBA CHIMBULU