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Grain imports liberalised…VAT on rice, potato seed removed

GOVERNMENT has liberalised the importation of grain at household level as part of a raft of measures aimed at mitigating the effects of the El Nino-induced drought and guaranteeing national food security.

This was revealed by Information, Publicity and Broadcasting Services Minister, Dr Jenfan Muswere after yesterday’s Cabinet meeting where food security was one of the major issues discussed.

The new measures will take effect from July and include duty waivers on the importation of rice, maize, potato seed, cooking oil and genetically modified maize for stockfeed, whose milling and distribution will be strictly supervised.

Cabinet also approved the removal of Value Added Tax on rice and potato seed since there is now more consumption of rice and potatoes in the country, with these products being predominantly imports.

Dr Muswere said Cabinet also considered and adopted the report on the preliminary food security outlook, April 2024-March 2025, presented by the Minister of Lands, Agriculture, Fisheries, Water and Rural Development, Dr Anxious Masuka.

“Among other issues considered, Cabinet discussed the importance of considering more hectarage for growing rice in view of increased rice consumption by the citizens,” he said.

“Cabinet also emphasised the need to support and promote local wheat production for direct consumption , for a swap with maize in order to meet maize demand for the nation.

“In light of the foregoing, Cabinet has approved the Food Security Outlook Report to March 2025 to facilitate winter cereals production planning and the food security strategy based on the comparative and competitive advantages of wheat this winter.

“That the consumption of 7,5kg per person per month be used immediately for social welfare and be adjusted after October to 8,5kg per person per month, the purchase of local grain at the import parity price of US$390 per tonne in order to mop up excess local grain.

Dr Masuka said the food security outlook is made of four components which are: what is in stock, what is likely to be produced in the current season, what is likely to be produced in winter and what is likely to be imported.

“This is what we deliberated; we said the private sector must continue to import maize for human consumption, we said if they wish to import genetically modified maize they can do so ,but that must be under strict supervision.

“Zimbabwe was one of the first countries in the Sadc region to put in place a GMO (genetically modified organism) policy in 1998 and formed the National Biotechnology Authority, and Zimbabwe allows GMOs to be imported because we have a very strict framework.

“Perhaps because of the strictness, very few private companies have actually come on board to do some experiments on GMOs. 

“In the past we have applied this model very successfully. It is genetically modified maize not GMO maize. We said that our food security ought also to be premised on consideration of wheat as a cereal crop, either for direct consumption by people as bread or as a mealie-meal or for swap arrangement,” said Dr Masuka.

The scrapping of VAT on rice and potato seed will be welcomed by stakeholders, including consumers, as it set to result in a reduction in retail prices. 

Recently, millers approached Treasury to scrap the 15 percent VAT on rice, which they argued would increase 07the price of rice on the market if left in place.

Grain Millers Association of Zimbabwe chairperson, Mr Tafadzwa Musarara last week said the imposition of VAT would increase the costs of 2kg from US$2 to US$3 due to change complications, weighing heavily on consumers.

Reached for comment on the latest developments, the Consumer Council of Zimbabwe said it would issue a comprehensive statement today.

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