Africa-Press – Zimbabwe. GOVERNMENT has announced a comprehensive review of business licences and regulatory fees to ease the cost of doing business and attracting investment into Zimbabwe.
Addressing a media briefing in Harare, Information, Publicity and Broadcasting Services minister Jenfan Muswere said cabinet considered and approved the review of licences, permits, levies and fees in the retail and wholesale sectors in line with the Cabinet decision of July 29 this year.
The resolution approved the implementation of a raft of business reforms in twelve sectors of the economy.
“The review process is aimed at reducing the cost of doing business, increasing competitiveness and enhancing the growth of the Zimbabwean economy,” he said.
“Cabinet approved the consolidation of fragmented licencing requirements into a single licence, the streamlining of duplicative and overlapping licences and permits, the removal of unnecessary levies and fees and the lowering of high levies and fees for the wholesale and selected major retail sub-sectors comprising the wholesale sector; supermarket and groceries; meat and meat products retail shops and butcheries and clothing shops and furniture shops.”
Fielding questions from journalists, Finance, Economic Development and Investment Promotion minister Mthuli Ncube said the review targeted excessive licensing fees and procedures that have long burdened businesses.
“As government, our analysis shows that the impact will be positive in terms of the profitability of some of the businesses. We will see improved profitability and therefore improved growth in these businesses.
“And secondly, you will see improved compliance with the law going forward. Because it’s clear that some businesses are surviving because they are not complying,” he said.
Ncube said local authorities were charging exorbitant fees which discouraged business compliance and hindered investment.
“We have noticed that some local authorities charge quite high fees. For example, to establish a shop in Uzumba Maramba Pfungwe Rural District Council one has to pay as much as US$4,200, while in Mazowe it’s over US$1,000. Yet in Muzarabani it’s only US$20. Such variations discourage compliance and deter investment.
“If you go there, it means you have to avoid being noncompliant for you to survive doing business. And yet we want small enterprises to locate in those areas to invest, to develop, create jobs, create opportunities. So the fees should not be that high,” he said.
Ncube said the government was rationalising multiple licences into single permits to simplify operations for business owners.
“And the other example is like this, if you have a shop and you want to start offering bakery sales or something like that, or fast food and so forth, you are supposed to acquire an additional licence for that purpose.
“You just have to have one licence, shopping licence, and then the rest can be waived. It should be subsumed within that one licence that, for example, we have removed the bakery licence for shop owners because that’s not necessary.
“We need only one licence to cater for that. So we have eliminated all of these, and surely these will go a long way in improving the environment for doing business,” he said.
The review will also see a sharp reduction in several business application fees, including liquor licences, whose wholesale application fee will be cut from about US$1,080 to US$20 to align with regional standards
“The application fee for a liquor licence, for example, for wholesale, this is within the city, is something like US$1,080 annual fee and we propose that this should come down to US$20 because also we have compared with the rest of the region. This will go a long way in supporting our businesses so that they do not prefer to go other countries,” said Ncube.
On the issue of bank charges, Ncube said while no agreement had yet been reached with the banking sector, government remained concerned about high fees that impact consumers and small businesses.
“On the issue of bank charges, we did not agree in terms of the process for action or capping or whatever. This was just highlighted as an issue just to remind you that what we are seeing as government is that, for example, if you look at monthly account service charges, this can be up to US$15 for individuals and US$20 for corporates. Withdrawal charges can be up to 3% of transactional value.
“Transactional charges or money transfers, bill payments and so forth can range anywhere between 1.5% and 3% and so forth. So we took note of these as an issue when it comes to supporting our retail and wholesale sector and other forms of payment.
“We as government acknowledge that this is an area where we need to engage the financial services sector, the banking sector, to see how this can be managed.”
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