Zimpapers Logo

Business Reporter
MOBILE services provider Econet Wireless and the Zimbabwe Revenue Authority will next month square off at the Fiscal Appeal Court which is set to preside over their dispute on the classification of base stations and the components that constitute a base station. A difference arose between ZIMRA and Econet regarding the classification of base station components imported in knocked down form and the matter was referred to the Fiscal Appeal Court.

A general notice in the Government Gazette published last Friday and placed by the president of Appeal Court Justice Samuel Kudya said the matter will be heard on October 27.
“Notice is hereby given, in terms of section 18(6) of the Fiscal Appeal Court Act (Chapter 23:05), that an appeal hearing on the classification of a base station and the components that constitute a base station between Econet Wireless and the Zimbabwe Revenue Authority, Case No, FA01 /2014 will be heard on October 27 at 1000hrs or soon thereafter in Court “O” at Mapondera Building at the High Court of Zimbabwe,” the Government Notice said.

Statutory Instrument 41 /2002 says that; “Any person who imports into Zimbabwe or manufacturers within Zimbabwe goods of the class or kind to which the appeal relates may be heard in the appeal if he/she enters an appearance in the period and manner prescribed in section 7(1) of the Fiscal Appeal Court Rules”.

The allegations against Econet emanate from a tipoff from a whistle blower which pointed to potential abuse of the waiver by the mobile company. Allegations of falsifying invoices were also raised but Econet denies any wrongdoing.

In a statement released in July, Econet said its investigations revealed that since 1998, its base stations
were cleared by ZIMRA officials at different ports of entry under a duty free tariff.

“The classification of the base station components we imported under a duty free tariff was communicated to Econet in writing, and the classification was followed over a 10 year period from the time when the Department of Customs and Excise fell under a separate Director of Customs and Excise, who is not the current Commissioner General of ZIMRA,” Econet said.

“Base stations can never be imported as whole goods, as is the case with vehicles and such other imports. Base stations comprise components manufactured by different manufacturers in different countries. A base station is only complete when installed in situ,” the company said.

Garnishee orders that had been placed on Econet’s bank accounts over this matter for a capital amount of $15 884 943,46 plus a 300 percent penalty were lifted by an order of the High Court.

Econet said ZIMRA is bound by the practice it followed for over 10 years since the duty free tariff was introduced and argued that the position cannot be altered retrospectively.
The dispute is before the High Court and the Fiscal Appeal Court.

Econet argued that the allegations show that the whistle blower wanted to extort the company and to cause friction and suspicion between Econet and Zimra.