The Sunday News
Business Reporter
THE Government will cancel offer letters to all farmers who would fail to pay Development and Rental levies for three consecutive quarters, a Cabinet Minister has said.
Presenting his 2016 budget on Thursday, Finance Minister Patrick Chinamasa said the law will also apply to those who are leasing farms. The Government with effect from 13 November introduced a rental and land development levy for both A1 and A2 farmers. Under the new law A1 farmers are supposed to pay a $10 Rental Levy, and $5 Development Levy, all per annum.
A2 farmers are mandated to pay a Rental Levy of $3 per hectare, and a Development Levy of $2 per hectare, all per annum.
The levies are payable quarterly, and apply to all resettled farmers with permits and 99-year leases across the country.
“The Minister of Lands and Rural Resettlement will cancel offer letters of farmers who fail to pay Development and Rental Levies for three consecutive quarters. The above provisions also apply to cancellation of permits in the case of the failure by a lessee to pay any rentals,” said Minister Chinamasa.
He said this was part of Government efforts to ensure that farmers use the land they were allocated. He said the levies will form part of the Consolidated Revenue Fund.
“The Minister of Lands and Rural Resettlement, through officers in the Ministry designated by the Secretary of that Ministry, shall be responsible for the collection of the Rentals and Development Levies on behalf of the State.
“The amount of all rentals paid by the holder of an offer letter who becomes a lessee shall be deducted from any amount required to be paid by him or her in terms of the land resettlement lease as arrear rentals from the time the holder occupied the A2 farm to which the lease relates.”
Rental levy, said Minister Chinamasa will be used by the Ministry of Lands and Rural Resettlement, while Local Authorities will utilise funds raised from the Development Levy. Part of the Development levy will also be used to meet expenditures on projects within the rural district council area from which the levy was collected. To unlock potential in agriculture, Minister Chinamasa said Government has been working on measures to improve the security of tenure of both the A1 and A2 resettled farmer.
He said Government will provide security of tenure for both A1 and A2 farmers.
“This programme will facilitate issuance of permits and tradable lease agreements, that way giving economic value to land under both the A1 and A2 resettlement model.”
Financial institutions have been reluctant to recognise land distributed under the land reform programme as security when applying for loans resulting in funding constraints for the sector.
Zimbabwe Commercial Farmers Union past president Mr Donald Khumalo said Government must sit down with farmers and find out why some were not producing or were not utilising the land rather than coming up with measures which will even hinder the growth of the sector.
“Of course I want to encourage farmers to pay the levies but there are a lot of factors why farmers might not pay. Government thinks some farmers are sitting on land and they should ask themselves why,” he said.
Mr Khumalo said farmers were being frustrated by lack of markets and the influx of cheap products in the country.
“Right now how would a farmer who grew wheat or maize do that when they are paid after a year or not paid at all? Do you think that farmers will continue farming?, That is when you will find some farmers with idle land.”
Although Government has finally paid farmers who were owed by the Grain Marketing Board, bakers have indicated that they can no longer buy wheat locally since it was expensive, meaning wheat farmers have been completely thrown out of the picture.
Mr Khumalo said there was a lot of fiscal pressure on Government but that does not necessarily mean squeezing a cent from every one.
“If a tree does not produce lemons, you don’t take lemons from another tree and say they must cater for those from the one not producing. You investigate why it is not producing and address the factors,” he said.
