Minister Chinamasa
Business Reporter
Government has rescinded an early decision allowing the Ministry of Agriculture and Rural Resettlement to collect rentals and land development levies from A1 and A2 farmers, giving the responsibility back to rural local authorities. This new policy directive will be operationalised beginning next year.
In 2015 the previous administration gave the green light for the Lands Ministry to take over the collection of land rentals and unit tax from all A1 and A2 farmers following reports that some rural district councils (RDCs) were abusing the money.
The RDCs, then hit back saying giving the responsibility to Central Government was going to cause some administrative bureaucracy that will retard development in newly resettled farms.
However, announcing the 2018 budget proposals last Thursday, Finance and Economic Planning Minister Patrick Chinamasa, said the policy directive was reversed and local authorities will now collect the levies.
“In an effort to ensure efficiency in the collection and compliance of farm rentals and land development levies, the 2018 budget proposes to re-assign Local Authorities as the collecting agent for land fees. The funds derived from rental levies will be for use by the Ministry of Lands, Agriculture and Rural Resettlement, while Local Authorities will utilise funds raised from the Development Levy.”
Government introduced land levies for land holders that saw A1 farmers paying $15 per year for the land they have. Under the scheme, $10 is land rental while $5 is unit tax that goes to RDCs.
The A2 farmers pay land rentals of $3 per hectare per annum and $2 unit tax per hectare, resulting in the farmers forking out $5 per hectare per year. Private companies using State land will pay $10 land rental per hectare per year and $2 unit tax.
Government has resettled 145 775 families on 5,979 million ha under A1 and 18 289 people on 2,978 million under the A2 model. This means Government can collect about $15 million from A2 farmers alone and $2 million from A1 annually.
However, the previous administration felt there were challenges with accountability, resulting in a directive for the ministry to take over the responsibility. Following the new directive, some provinces frowned at the arrangement that they felt would result in lethargic development in the farming communities.
According to some councillors, the move was also likely to cause problems in the enforcement of council by-laws particularly in environmental management and conservation. In protesting the move then, the RDCs felt farmers would have less respect for an authority that does not levy them right on the ground, hence making it difficult for council to implement some of its by-laws.
The councillors also claim that under the old system their personnel would simultaneously attend to most of the environmental and conservation issues during their revenue collection visits.