By CHATULA KANGALI –
A MULTINATION professional body has said increase in the number of taxes proposed in the 2018 budget would negatively affect the flow of Foreign Direct Investment( FDI)in the country.
Pricewatercoopers (pwc) observed that some of the taxes proposed like the excise duty on fuel and cement and the introduction of five percent property transfer tax on intellectual properties would contribute to the high cost of doing business in Zambia.
Pwc Tax Director Jyoti Mistrys said there was need to work on some taxes in order to reduce the cost of business and attract more investment .
Ms Mistrys said the rate of taxation in Zambian was among the highest in the region which would make Zambia less competitive in Foreign Direct Investment.
“ There has been many changes in taxation in the 2018 Budget, however, the rate of taxation is still high compared to performing economies such as Botswana and South Africa among other.
Investors would rather set up their businesses in countries were they are few taxes, ” she said.
Ms Mistrys was speaking during a stakeholders budget analysis at the Protea Hotel in Ndola on Monday this week.
Stakeholders included the chamber of commerce, the manufacturers, mining firms and tax agents.
Ms Mistrys said with the high number of taxes in the country rate tax avoidance and invasion was likely to increase.
During the discussion, the stakeholder urged Government to give a clear explanation on the introduction of K2 cement levy meant for infrastructure development.
Pwc observed that the removal of the income tax incentives was unlikely to attract additional investment in priority sectors.
Ms Mistry said the provision of accelerated capital allowance would not benefit investors that apply for the Zambia Development Agency (ZDA) licences as investors would be unable to get full tax relief on expenditure.