Economics Association of Zambia President Lubinda Haabazoka says there is need to defer sales tax to 2020.
Dr Haabazoka has since proposed that in the meantime, government should zero rate domestic Value Added Tax for legal entities but keep import Value Added Tax.
He has however proposed that Import VAT refunds should be suspended.
He said this move will seal the leakages but maintain revenue collected from through VAT thereby meeting the budget targets.
“We should do everything possible to ensure that the Kwacha does not trade at k13 per dollar. On Friday the green back was trading at k12.5 per dollar from k12.1 on Wednesday. Ideally the Kwacha gains from April as mining companies scale up production, the agriculture sector exports their harvest among other factors,” he observed.
He added, “To avoid further speculation and adverse effects, it is advised that the difference between the Bid and Ask price should be above k0.5. This will stop players from speculating. We also need to boost our foreign exchange reserves by engaging businesses to help bring their foreign reserves into the country.”
Dr Haabazoka who is also Head of the UNZA Graduate Business School said the extractive industry should also be encouraged through the fiscal policy and other incentives to make Zambian banks primary holders of proceeds from the sale of mineral resources.
“There is also need to immediately restructure debt so as to make cash outflows match cash inflows. Infact there should be cash inflow out flow matching to insure that negative gaps are identified are treat to avoid liquidity problems. The formula that can be used at national level should resemble that done by commercial banks,” Dr Haabazoka said.
What are you talking about? There is absolutely nothing to worry about. Everything is going on track for the future? Maggie is in control
Thanks
Prof here missed a point … you can’t continue to collect import VAT but suspend refunds. It does not pass the legal test.
So, gear up and proceed with GST now but in the current form as VAT but just change its name to GST next year is essentially what Prof is saying.
Which is nothing but semantics … GRZ needs to proceed with GST and abandon VAT as scheduled because following Prof’s advise would lead to legal challenges in courts over refunds from the private sector.
You don’t want to go backwards especially that there are huge gaps between inflows and outflows at ZRA that don’t justify maintaining the current VAT system.
This aspect is beyond his pay grade as an economist … leave that part to us accountants and investment bankers we will advise you accordingly…
This silly fat boy Lubinda Haabazoka is just showing how disingenuous he is …you will see alot of them now back tracking the very things the championed, there are bloggers on LT as well just read above …sh%t is about to hit the fan. This Lubinda should take his Russian papers back to Moscow there are no use outside Russia.
Sales tax can be a tool to stimulate the economy if only well thought out and implemented. Two choices: exempt all food except restaurant food. Two, we could exempt all agricultural and manufacturing products from them to attract high yields thereby promoting growth in these sectors.
Lol… Dudu in control
This man amazes me, after putting so much pressure to go sales tax way, now this! policy inconsistency. How will business react? What happens to 1st July date? We where told that ZRA was on top of things. Guys it’s Monday today, don’t stress so early in the week.
People like him should never amaze you as he is an educated foooooool…he has thrown his professionalism outside the window.
Trouble is ECL does not understand Economics! He is lost at see and deaf at the same time!
At least wise guidance from LH!
This economy is salvageable! If I was in charge, this is where you call in all former Finance Ministers and all Economics gurus and get them to brainstorm and come up with the best way forward. One way is to reduce the number of ministers and fuse some Ministries. For example, Education Ministry to revert to one Ministry. This is time to make unpopular decisions to save the economy! Sadly ECL is inept and incompetent!
VAT has no problem, it is the abuse of VAT which is a problem. Companies has been inflating VAT input while lowering VAT output this has resulted Zambian government loss in revenue. So Sales Tax must be implemented this year. Those who are rejecting Sales Tax they know how they manipulating VAT inputs and outputs
But why is VAT abused…there are countries that use it efficiently why should Zambia be the only ones having issues. Norway has offered assistance you refused …what type of govt refuses to repay VAT to companies? Why is it MMD never had this problem? PF is a reckless govt.
So iwe Wabazoka, you were supporting g blindly that economy was good. And today you see seeing reality of doom looming. Kanzhi uli wa fake. Hungry dog waving tail for food
Dr.Haazoka,may be this is the time to relook the entire Govt Sales Tax(GST) and VAT examine if all we need the former or reform the latter.You approach of collecting import VAT without refunding while at the same time zero rating domestic products that attract import VAT sound fraudulent and non compliant with principles of fair taxation for same products and defeats purpose of VAT being a tax borne final consumers.On forex Sis 32 and 55 of 2013/14 were drafted with principles to bring accountability in forex from major exporter,mine’s.They were fought by influential Zambians,one of the reasons we don’t control forex inflows despite increased exports.We can try again!
VAT has never been the problem. The problem is that the held VAT which was supposed to be repaid was misappropriated by the government and then they end up failing to pay. Solution would have been to exempt some inputs especially for mines. Remember, if you don’t pay VAT when you purchase, then there wont be a refund.
This moron has finally come back to his senses, according to him we should encourage foreign companies to bring their money in Zambia to prop up our reserves? Is this logical thinking? Now that the issue of sales tax has started confusing the kwacha, you are now rambling like a parrot. Is this the kind of people we need to head EAZ and that position at UNZA? What comes out of this man’s mouth is utter gibberish and nothing more. Confused characters.
I pity people studying through UNZA business school
I thought the guy talks to the president, why write to social media.
He is on Miles Sampa’s 25 man advisory team as well…really laughable!!
Markets are sensitive. Any form of speculative intervention automatically triggers a negative response. The issue of sales tax is particularly sensitive. It was prudent to do conduct further research on the basis of resistance to its introduction in the market place. Who does not want food? Who does not need food? The fundamental issue is tax revenue collection. It can not be done anyhow. The public opinion needs to be taken into account before new regulations are implemented. Even old regulation may need to be fine tuned to bring them in line with current trends.
When you read Mr Haazoka’s proposals always remember- talk is cheap.
You see the kind of advise that is being given to government and the characters in the BOMA and wonder why the country is in this mess . They are all a bunch leading us into the dark ages.
Why Habaazoka propose to eat with both hands? What kind of advice he is giving? Its either VAT or GST he should know
No government position in the offing has now made this man to backtrack on everything he was supporting blindly as long as it was coming from government. Once he is invited for lunch at state house he will change again.
Even this dirty moron knows that we are heading for a disaster and yet the two drunks are not badging on their drunk stance, hell bent on destroying the country
Dr Haabazoka has since proposed that in the meantime, government should zero rate domestic Value Added Tax for legal entities but keep import Value Added Tax.
If your supplies are zero rated it means you always get a refund. These refunds are the source of the problem.This guys does not understand VAT.