Calculation of Duty

CALCULATION OF DUTY
PROCEDURE
Calculate the FOB first and check if remission applies.
If over the remission threshold, calculate the VDP.
Check for applicable rebates and apply them.
If over the rebate(s) threshold, apply duty to the excess value.
Try as much as possible to grant rebate first to those goods that attract the highest rate
of duty.
Note that the importer may request use of specific tariff before calculation of duty.
This privilege must not be denied.
Calculation of duty on commercial consignments is usually straight forward. It is

important though to check if preference is being claimed. If so, and all necessary
documents available, then clearance is done according to the conditions of that trade
agreement against which preference is being claimed.
If duty is payable, check if the goods attract either ZWL or forex duty. If ZWL,
VDP should be in ZWL otherwise VDP should be in USD.
It is a different thing when the issue of partial rebates come to play.
An example is when a traveller brings for his personal use the following items: Books
for $80, 3L Brandy $25, 10L opaque beer $30, Hi-Fi Radio $280, Defy Stove $160.
When calculating the duty for the above, first it can be seen that the value is way off
the remission threshold, therefore we proceed to grant applicable rebates if any.
Check if all the items qualify for the rebate. If an item does not qualify, full duty will
be charged on it. For those that qualify, add their values and check if total is within
the limits of the rebate. If exceeding the limit, deduct values of those items that attract
the highest rate of duty in their order. Please take special care on how to apply rebates
because that will affect what need to be deducted from the value. If all allowable
deductions are effected as per the rebate, duty is then calculated on the remainder of
the goods. Special attention must be given in dealing with alcoholic beverages. It is
advisable to deal with these first since special provisions apply to them. Regs 114.
DISCUSS AND CALCULATE THE DUTY PAYABLE BY THE TRAVELLER
ABOVE GIVEN THAT HE QUALIFIES AS A TRAVELLER AND IS
COMING INTO ZIMBABWE AFTER A 3 MONTH AWAY PERIOD.
How much duty is payable in the following situation:
1. Company X is importing 500 office paper staplers worth R30000.

2. Company Y is importing by Air, a 2013 Toyota Camry 2000cc Petrol
engine Vehicle worth EUR6000.
3. Mrs Sithole is importing a kitchen cabinet which she bought for R9000
4. Mr Dube is importing an LED television he got from his friend as a gift
and therefore did not pay for it. The value of the TV is R3600.
5. Mr Nleya just crossed into South Africa and after about 2 hrs is bringing
back a few groceries worth R170.00
6. You are bringing in 1000 leather handbags for ladies worth R54000.
REVENUE HEADS
Customs Duty – Levied on imports. Usually referred to as import duty. Rates are as
per Customs tariff handbook.
Excise Duty – Levied on selected locally manufactured goods and excisable imports.
Rates are as per the excise tariff.
Surtax – This is levied on imports. This is additional to the usual Customs duty.
Rates are either 25% general or 35% of VDP for imported luxury vehicles more than
5 years old.
VAT – Value added tax is levied on all imports unless exempted as per the VAT
regulations. If not exempted, goods are either zero rated or are charged 14.5% of VTP
(VVP). VTP(Value for Tax purposes) =Value for Duty Purposes + Customs Duty
Presumptive tax – This is levied on goods being imported by commercial importers
without active BPN or those whose tax affairs with ZIMRA are not up to date. It is
charged at a rate of 10 percent of VDP.
Other duties include Anti-dumping and Counterveiling duties. Refer to Act.

STYLES OF DUTIES
AD-Valorem rates of duty

These are expressed as a percentage. The amount of duty will be a percentage of the
VDP. Eg 5%
Specific rates of duty

This are based on units of quantity. Eg $5 per kg.
Alternative Rates of Duty

This is where there are two different rates separated by the word ‘OR’. The effective
rate is the one that yields the higher amount after comparing the two. Eg $5/L OR
$10/LAA
Combination rates of Duty

This is where two different rates are given separated by the symbol ‘+’. The effective
rate will be the sum of the two different rates. Eg 40% + $2/kg
HOW DUTIES ARE CALCULATED
For example, a product has a VDP of $10000 and the rate of Customs duty is 10% Ad
Val. The calculations will be as follows:
TAX BASE RATE AMOUNT

Customs Duty 10000 10% 1000
VAT 11000 (VDP+C/D) 14.5% 1595
S/Tax 10000 -
Total 2595
The following process need to be followed when establishing how much duties and
taxes are due on a particular shipment:
1. Check for adequacy of documentation. Some documents may trigger the

imposition of additional taxes. Absence of a valid tax clearance certificate will
attract additional tax of 10% of VDP as Presumptive tax.
2. Check for any applicable rebates, suspensions or exemptions and apply as
appropriate.
3. Check if the goods pay VAT or are zero rated or exempt. Apply the correct
rate. Use the VAT Regs for the purpose.
4. Check if product pays surtax by referring to the Surtax tariff.
5. If goods are being cleared from a Bonded warehouse, duty at the time of
clearance is effective.
It is important to check whether the duty on the goods is levied in ZWL or in forex.
Always refer to SI252A of 2018 for this purpose.
On point 2, it is therefore very necessary to have an appreciation and understanding of

the available commercial rebates eg Motor Vehicle Assembly rebate, Spirit Rebate,
Bicycle Assembly rebate, Inward Processing Rebate, Clothing Manufacturers Rebate,
etc.
Exercise
1. Mr Mpofu is a registered commercial farmer and is importing a consignment

of 200 gumboots for his farm employees. The cost of each gumboot is R400.
He uses his own truck to bring the gumboots into Zimbabwe. How much is the
total payable for the gumboots?
2. A 400kg consignment of 2000 units goods is brought from Germany. The
VDP for the goods is calculated to be ZWL880 000.00
Calculate the total duties and taxes payable f the rate of Customs duty is:
a. 30%
b. $5/ unit
c. 40% OR US$8/kg
d. 60% + US$5/ unit
Rebate Letters
There are some goods that may require the Commissioner General to grant a rebate of
duty. In such situations, the Commissioner General issues a Rebate letter to the
Importer specifying the goods that may be imported under rebate. Both duties and
VAT will be fully rebated. Nothing is payable on such goods.
Trade Agreements
The majority of trade agreements suspends the Customs duties and Surtax provided
that a Valid certificate of Origin is produced. However, Trade agreements do not
suspend the payment of VAT. VAT remains payable unless exempted or zero rated.
Suspensions
Goods specified in the Suspension Regulations suspends the Duties payable. VAT
remains payable unless exempted or zero rated.
Duty Free Certificates

These are certificates issued by a Ministry exempting the payment of duty on goods
specified in the certificate. However, VAT remains payable unless exempted or zero
rated.
VAT Regulations
This SI lists goods that are exempt or zero rated on VAT. Ie, those items that do not
pay VAT.
Surtax Tariff
This SI lists goods that attract Surtax on importation. It also gives the general rate of
Surtax and the type of goods that attract a different rate of Surtax.

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CALCULATION OF DUTY

Calculate the FOB first and check if remission applies.

If over the remission threshold, calculate the VDP.

Check for applicable rebates and apply them.

If over the rebate(s) threshold, apply duty to the excess value.

Calculation of duty on commercial consignments is usually straight forward. It is

It is a different thing when the issue of partial rebates come to play.

How much duty is payable in the following situation:

1. Company X is importing 500 office paper staplers worth R30000.

Other duties include Anti-dumping and Counterveiling duties. Refer to Act.

AD-Valorem rates of duty

Specific rates of duty

Alternative Rates of Duty

Combination rates of Duty

TAX BASE RATE AMOUNT

1. Check for adequacy of documentation. Some documents may trigger the

On point 2, it is therefore very necessary to have an appreciation and understanding of

1. Mr Mpofu is a registered commercial farmer and is importing a consignment

Duty Free Certificates

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