HARARE - Zimbabwe risks losing more than $42 million in revenue through leakages from clearing agents lodging false Removal in Transit (Rit) declarations through Beitbridge Border Post (Beitbridge), a latest report from the Auditor General reveals.
In her latest narrative report on State Enterprises and Parastatals for 2014, Mildred Chiri, the Auditor General, said between 2011 and 2013 a total of $18 million Rit entries generated by Zimbabwe Revenue Authority (Zimra) from its Beitbridge port had not been acquitted and as at the end of last year the Rits amounting to $19 million had also not been cleared.
“The amounts for 2013 Rits were 50 percent of the total Rits, implying that the amounts were now doubtful given the fact that entries amounting to $565 599 were due for cancellation while transactions amounting to $14,5 million were lodged by clearing agents who had since closed business without acquitting the Rits and their insurers who would have guaranteed the clearing agent consignment had also closed business,” read part of the report by Chiri.
This comes as consignments and travellers passing through the country to other destinations within the southern African region register their consignments as Rits implying that their items are not dutiable and expected to acquit these registrations at the port of exit.
“Registration of commercial traffic in transit is accepted upon registration of a bond through an insurer which Zimra can call in case of failure to acquit the Rit entry by the agent,” Chiri said.
However, Chiri noted that the possible revenue leakage implications points to a possible drop in domestic tax revenue as a result of an upset of the domestic pricing balance as these goods will be priced cheaper as compared to those that would have gone through the formal importation process.
The Auditor General recommended that Zimra introduce a computerised tracking system and that as soon as the three days lapse, duty should immediately be called from the guarantor.
“Zimra should also embark on continuous screening of clearing agents and guarantor.
“They should unmask the real importers such that when the agent and the guarantor fails the importer pays duty, this makes the importers to transact with reputable agents,” she said.
A response from Zimra contained in the report revealed that efforts to acquit the outstanding Rits had been made as evidenced by the reduction of potential revenue at stake for 2013 from $30 million at December 2013 to $22 million registered last year, leaving a current potential debt at $18 million.
“To improve transit cargo management, the Authority is working on the introduction of electronic cargo tracking system based on GPS technology, Sadc and Comesa regional transit guarantee bond systems are also being developed,” Chiri said.
She added that Zimra management assured that there were making follow up efforts on closed agents and insurance companies to establish their operational status in a bid to recover the potential revenue.