An Energy Expert says government’s decision to remove 16 percent tax on petrol and diesel is a Christmas and New Year bonus for Zambians, as it will translate into fuel reduction.
Speaking in an interview with Money FM News, Yotam Mtayachalo stated that the cost of fuel is undoubtedly high, resulting in the high cost of doing business.
Mr. Mtayachalo said government must be commended because it is mindful of the economic hardships the people are facing.
He described the decision to remove 16 percent tax on petrol and diesel as a Christmas and New Year bonus for Zambians.
“It is a very good move undertaken by Ministry of Finance to zero rate Value Added Tax. I think it should be a Christmas or New Year bonus for the people of Zambia.”
“Undoubtedly the cost of fuel in Zambia is quite very high, coupled with higher electricity tariffs, so that has increased the cost of doing business in the country and also it has triggered high cost of doing business. If government is mindful of the economic hardships the people are facing I think it must be given a pat at the back because that’s how governments are supposed to be, Governments are supposed to have a human heart,” Mr. Mtayachalo said.
And Mr. Mtayachalo said it is a known fact that the price of crude oil on the international market has gone down tremendously, hence Zambia should also benefit from the low oil cost.
He appealed to Oil marketing Companies (OMCs) to reciprocate and immediately reduce the pump price of petrol and diesel so that Zambians can benefit from the tax exemption.
“It is undeniable that the price of crude oil on the international market over some few months has gone down tremendously. So we expect that the people of Zambia should also benefit from the low cost of oil on the international market.”
“I just want to appeal to these Oil Marketing firms, I think that it is important that they should reciprocate and immediately reduce the pump price of petrol and diesel so that Zambians can benefit from that reduction,” he stated.
The Ministry of Finance has removed 16 percent tax on petrol and diesel, which must translate into a fuel price reduction.
This has been done by way of introducing a stat Statutory Instrument 125 of 2020 on Value Added Tax (Zero Rating) (Amendment) Order, 2020.
This Order which came into operation on 1st January, 2021 has been issued by the Minister of Finance, Dr. Bwalya Ng’andu.
Zero rating is a tax exempt, and the reasoning behind it is to provide basic items and/ or foodstuffs at a reduced price to benefit the poor.
The order has been applied on petrol and diesel, and it is expected to make the fuel pump price affordable.