NMC managing director, Peter Cottan said commercial farmers' argument
for charging in dollars was that inputs were bought in dollars.
Why should commercial farmers have a dollarised industry? It's not
right. The devaluation of the Kwacha has had a major impact on our
profits, he said.
NMC has since called on the central bank to control the dollarisation
that has hit the market and is thus contributing to the devaluation of
the Kwacha.
In an interview, Mr Cottan said companies currently pegging their prices in dollars should be made to charge in Kwacha.
He said to a large extent, the devaluation of the Kwacha was due to low
copper prices but noted that pegging local products in dollars was
causing further depreciation.
Mr Cottan said about 190,000 tonnes of wheat was grown locally and sold to millers in US dollars.
He said millers were exposed to the exchange losses adding that in
September last year, the Kwacha stood at K3,500 and K3,900 to the US
dollar and today it was fetching K5,250.
He said the charging of wheat in dollars by commercial farmers was affecting the price of flour and that of bread.
Meanwhile, Mr Cottan says for the country to grow, there was need to ensure that everyone was tax compliant.
There is need to level the playing field so that companies compete
favourably on the market. The Zambia Revenue Authority (ZRA) should be
pro-active, go after non-compliant companies to broaden the tax base,
he said.
He alleged that most of ZRA officials are unable to collect tax from the erring milling companies because they are compromised.
Companies are defaulting tax especially Value Added Tax (VAT). If a
miller wants to break VAT chain, they can agree to buy wheat from the
farmer cash and no invoicing done, he said.
Mr Cottan said tracing of companies defaulting on VAT is easy if ZRA
could conduct an audit trial through the value chain of the products. –
Zambia Daily Mail.