HomeBusiness DigestGovt fails to disburse tobacco levy funds

Govt fails to disburse tobacco levy funds

Afforestation plans in Zimbabwe are in jeopardy after Treasury failed for two consecutive seasons to disburse US$13,2 million collected in tobacco levies meant for the cause, businessdigest has learnt.

By Fidelity Mhlanga

The 1,5 % tobacco levy which had been scrapped in 2005, was re-introduced by government in 2015, as golden leaf production shot through the rood to cater for the environment through afforestation. The money is meant to assist tobacco farmers in growing gum trees and access alternatives to firewood for curing tobacco.

Disgruntled farmers are lobbying for the removal of the levy citing lack of transparency in the manner it was being administered.

In his budget presentation last week, Finance minister Patrick Chinamasa said the levy would be administered by Tobacco Industry Marketing Board (TIMB).

“We are waiting for the statutory instrument which will put the parameters on the administration of the levy. The act will guide us on how to proceed on administering the money. It should come into effect in January before the opening of the marketing season,” TIMB communications manager Isheunesu Moyo said on Wednesday.

Despite assurances from the Reserve bank of Zimbabwe that golden leaf farmers would get their 5% incentive by end of November, farmers are still to get the incentives three weeks down the line.

“No one has been paid yet as of now, they are still working on logistical issues,” Moyo said. “It’s something they are working on”. He said the opening dates of the marketing season will be informed by the crop assessment, which will be done early next January. “We do not have an exact date. We have not finished our crop assessment. We hope it will be earlier than last season as the governor was requesting,” he said.

During an occasion to mark the end of the tobacco season mid-November, Reserve Bank chief John Mangudya underscored the importance of the golden leaf, saying the tobacco marketing season should be opened early as it was fundamental in oiling the nostro accounts.

“If we don’t have a tobacco farming season, the nostro accounts run dry and this shows how important tobacco farming is in Zimbabwe,” Mangudya said last month.

Statistics from Timb shows that as of December 1 2016, tobacco planted area for the 2016/17 was 32 208 hectares up from 28 865 hectares planted last year.

At the same time, the number of tobacco farmers, who have registered to grow tobacco for the 2016/2017 season has risen by 6% to 73,492 from 69,518. Tobacco is the second source of liquidity after gold has as of December 1 earned US$ 902,4 million after 161,3 million kgs of tobacco was exported to various destinations.

Treasury has projected the 2017 tobacco output at 205 million kg up from 202 million kg attained this year.

Previous articleAre Zimbabweans revolting?
Next articleA review of 2016

Recent Posts

Stories you will enjoy

Recommended reading