Posted on May, 24, 2021 at 09:38 am
Dar es Salaam — The government on Wednesday, May 19, 2021, outlined tax and non-tax measures imposed to attract establishment of cashew nut processing factories in the country.
The minister of state in the Prime Minister's Office responsible for investment William Olenasha outlined the measures in Parliament when responding to Nanyamba Constituency MP Abdallah Chikota during the Questions and Answers Session.
In his question, Mr Chikota sought to know the government's plans to put in place special incentives to attract more investors in cashews processing companies.
Responding to the MP, Mr Olenasha said basing on the Export Processing Zone Authority Act Cap 373, the government has put in place several tax incentives including exemption of corporate tax for 10 years, Value Added Tax (VAT) by 100 percent to capital goods as well as 100 percent withholding tax exemption to interests of loans sourced internationally, rent and dividends.
"Also, the government provides 100 percent custom duty exemptions to machineries and equipment. Following the new measures and procedures, a total of five factories have been registered by EPZA," he said.
He said the government will continue offering different tax and non-tax attraction measures in order to attract investment including allocating special areas for construction of factories in the cashews producing areas in the country.
According to him, those special areas will be provided with all support services and infrastructure such as electricity, water and roads as well as levies imposed on machinery, equipment, parts and packaging materials.
He said being among the five strategic crops in the country, since 2018 the government has been implementing a special mobilization program in all cashews growing areas to ensure availability of better cashew seeds, extension services and inputs in order to give assurance of availability of enough raw materials for domestic factories.
"At least 20 regions are now producing cashews at different levels. In the 2020/21 production season, 200,010 tones was produced worth Sh477 billion," he said.
He said the government has introduced the cashews primary market system in the 2020/21 production season that enables domestic processing firms to buy cashews for raw materials in their processing firms without competition at low prices.
According to him, at least 2,021.7 tonnes was purchased by nine factories that participated in the primary trading market.
Responding to a supplementary question from the MP on measures taken to attract more farmers to take their produce to the new market that is considered to give low prices, the minister said the government will continue attracting more farmers to take their produce to the market.
Source: The Citizen