By JUDITH NAMUTOWE –
THE Dairy Association of Zambia (DAZ) has appealed to the Government to consider zero-rating milk products for value added tax in 2015 National Budget.
DAZ executive manager Jeremiah Kasalo said in an interview in Lusaka that there was need for Government to zero-rate milk products to bring
down the cost of production.
Mr Kasalo said one major challenge members were faced with was the high cost of production, making it difficult for processors to sell products at competitive prices, hence the need for Government to zero-rate milk products.
“Our milk is high compared with other countries in the region. This makes it difficult for processors to sell their products at competitive prices when you compare with imported products because the raw material used is expensive.
“So we are appealing to government to consider zero rating the milk products in 2015 Budget. It is important because when you zero rate farmers are able to claim for input value addition tax VAT,”Mr Kasalo said.
Mr Kasalo also said the Government should also adjust import duty on full-cream  milk powder  that is imported for further processing from the current  five  per cent  to 15 per cent, to address the challenge faced by the association with reconstituted milk.
He called for removal of tax charged by the Zambia Revenue Authority (ZRA) for producing ultra high temperature (UHT)  juice as this was
making local products uncompetitive.
“In order for the UHT milk to be competitive companies need to make use of equipment at full capacity,  hence they need to have increased throughput.
“We have also proposed to Government to remove VAT on major feed ingredients, such as vitamins and other major ingredient for feed formulation,” he said.