Crocozilla
JF-Expert Member
- Oct 17, 2012
- 469
- 335
The introduction of Value Added Tax (VAT), on transit goods for land locked countries which although it has not yet been enforced, seem to have ...
The introduction of Value Added Tax (VAT), on transit goods for land locked countries which although it has not yet been enforced, seem to have scared some port users from those countries.
According to Dar es Salaam’s acting Port Manager, Hebel Mhanga, Zambia total cargo traffic in the first two months of this year, dropped by 47.6 percent to 121 in comparison to the same period last year. In 2015, Dar port moved 1.9 million tonnes of Zambia’s cargo.
This was equivalent to 34 percent of potential business of 5.6 million tonnes to and from Lusaka. The figure makes Zambia the biggest Dar port user. “Thought VAT is yet to be enforced, it has scared importers to the extent they are using alternative ports in the region,” Mr. Mhanga said.
VAT was supposed to start in 2015/16 fiscal year. TRA has yet to impose the law but its spiral effect sprung to the entire Dar port users.
Mr. Mhanga said copper cargo volumes from Zambia might decline further as most of the agreements are coming to an end.
“These mining firms are likely to use ports around us, which do not impose VAT on transit goods, despite intense negotiation. Unless the VAT is scraped off the books,” Mr. Mhanga said.
Zambia export traffic through Dar port has gone down by 5.9 percent in between January and February this year.
“We expected that DRC-Congo traffic through our port will overtake Zambia this year. Our expectations have been defeated by VAT,” Mr. Mhanga said.
However, he also said DR-Congo cargo also declined due to the introduction of single customer territory as it work against Congolese traders who enjoyed to negotiating taxes with their authorities. Congo traffic for import went down by 19.7 percent while export dropped by 13.3 percent between January and February against same period last year.
Dar port is currently ranked second biggest in East Africa and fourth largest container port on Africa’s eastern seaboard after Djibouti, Durban, and Mombasa.
The introduction of Value Added Tax (VAT), on transit goods for land locked countries which although it has not yet been enforced, seem to have scared some port users from those countries.
According to Dar es Salaam’s acting Port Manager, Hebel Mhanga, Zambia total cargo traffic in the first two months of this year, dropped by 47.6 percent to 121 in comparison to the same period last year. In 2015, Dar port moved 1.9 million tonnes of Zambia’s cargo.
This was equivalent to 34 percent of potential business of 5.6 million tonnes to and from Lusaka. The figure makes Zambia the biggest Dar port user. “Thought VAT is yet to be enforced, it has scared importers to the extent they are using alternative ports in the region,” Mr. Mhanga said.
VAT was supposed to start in 2015/16 fiscal year. TRA has yet to impose the law but its spiral effect sprung to the entire Dar port users.
Mr. Mhanga said copper cargo volumes from Zambia might decline further as most of the agreements are coming to an end.
“These mining firms are likely to use ports around us, which do not impose VAT on transit goods, despite intense negotiation. Unless the VAT is scraped off the books,” Mr. Mhanga said.
Zambia export traffic through Dar port has gone down by 5.9 percent in between January and February this year.
“We expected that DRC-Congo traffic through our port will overtake Zambia this year. Our expectations have been defeated by VAT,” Mr. Mhanga said.
However, he also said DR-Congo cargo also declined due to the introduction of single customer territory as it work against Congolese traders who enjoyed to negotiating taxes with their authorities. Congo traffic for import went down by 19.7 percent while export dropped by 13.3 percent between January and February against same period last year.
Dar port is currently ranked second biggest in East Africa and fourth largest container port on Africa’s eastern seaboard after Djibouti, Durban, and Mombasa.
