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International governance watchdog local unit, Transparency International Zambia – TIZ has disclosed that the Electoral Commission of Zambia ECZ are to be blame for the record low voter turnout recorded for both Kabushi and Kwacha Constituencies on the Copperbelt.

The recently held Kwacha by-elections in Kitwe recorded a shocking 14% voter turn out while Kabushi of Ndola recorded another record low voter turn out of about 24%, a voter turn out that questions the credibility and community endorsement as well as representativeness of the final results.

Voters in the two constituencies as per inference from the final voter turn out, shunned taking part after it emerged that main opposition and immediate past ruling party – the Patriotic Front – PF candidates had been barred from re-contesting on legal and political technicalities, thereby denying the residents their right to pick leaders of their choice.

Speaking in an exclusive interview with the Zambian Business Times-ZBT, TIZ President Sampa Kalunga stated that there was a lot of what the institution termed as ‘political engineering’ which resulted into illegal activities taking place in the two constituencies.

“The two by-elections have left a big dent in the country’s democratic credentials and the quality of the justice system as there were a lot of political fighting between the ruling UPND and the main opposition PF.” he told ZBT.

Kalunga said the Kabushi and Kwacha by-election have made the courts look indecisive and very contradicting, we have seen that whenever the courts have tried to interpret the law, citizens have been left with more questions than they went with.

“We have seen where courts fail to give a clear no and a clear yes, a situation that has raised questions about the courts ability to deliver justice as they were meant to.” The TIZ President said the two by-elections have rendered the country’s democratic credentials, the courts and the justice system to be highly questioned and the perception of a number of people is that they demand for answers that are clear for all to understand.

“As much as we respect the courts, they have not lived up to our expectations as the by-elections have really damaged the reputation of all the key stakeholders.”

“We have become less – in terms of democracy during this time of by-elections in the two constituencies and also our courts have given us less confidence in the way they have handled the issues concerning the elections and further the ECZ itself has rendered itself to be questioned whether it is capable of being an impartial body that can handle the elections in Zambia fairly.” He said.

“President Hakainde Hichilema – HH was campaigning even before judgement was passed, this can be construed that he knew something before anybody else.”

“There is need for the governing UPND to learn that such behaviour were we see certain projects only being inspected during campaigns is leading back to the same system which used to happen in the previous regime.”

“We have also seen the government itself being overbearing we cannot do this, we have been over delayed tactical unfairly delays were somebody from the government cannot be present at the court so that they wait for the time to elapse.”

“The pain we having is being reminded of the same things that were happening in the previous government continuing happening under the UPND government.” He said.

The governing UPND won both constituencies amid what some have described as voter silent treatment that saw the elections being shunned. The UPND candidates total voter tally was too low to win such big constituencies, but’s its supporters contend that the low voter turn out shows that people are happy with the current government and that large turn out are for we’re their is a need for change of government.

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International governance watchdog local unit, Transparency International

Tech

Even as power utility ZESCO proposes to increase electricity connection fees among other proposed increaments in tariffs, it’s worrying to note that 70% of Zambia’s household are currently not connected to the electricity national grid.

According to the revelation by the Energy Regulation Board – ERB to the Zambian Business Times – ZBT, the official number of households connected to the national grid as at 30th June, 2022 was about 1.2 million.

When ZBT compared this 1.2 million households connected to the grid to a total of about 3.5 million households for the entire country using the official Zamstats average family size of 5.5 people and a national projected population of about 19 million people, this confirms that only about 30% of households in Zambia are connected to the electricity national grid.

This revelation puts state owned power utility ZESCO on the spot for its infatuation for exports when 70% of its citizens have no access to electricity at household level. The power utility despite this damning statistic has proceeded to request for an upward tariff adjustment of over 600%.

Responding to a press query from ZBT, ERB Corporate affairs Manager Kasumpa Namukolo said according to the report the regulator received from ZESCO as at 30th June, 2022, the official number of households connected was 1,177,699 (about 1.2 million) compared to 1,154,409 recorded at the end of quarter 1 of 2022.

She however said the breakdown of customers connected to the grid by province, district or constituency ward level, could best be obtained from their licensed grid connected distribution companies. This is despite the fact that universal access to electricity is a fundamental objective of any responsible ministry of energy as well as ERB.

“Though as a regulator, ERB has no direct role in connecting households to the grid, the Board guarantees that licensed distribution enterprises are appropriately compensated through a reasonable tariff or connection charges, which ensure growth in extending the grid and/or connecting more districts.” She said.

Kasumpa explained that Key to the ERB’s mandate is to ensure that the electricity is financially and technically viable through implementation of regulatory practices that promote investment in the sector in line with Government policy.

She said ERB is mandated under the Electricity Act No.11 of 2019 to secure a regular, efficient, coordinated and economic supply of electricity and also to facilitate universal access. Kasumpa however mentioned that ZESCO and Rural Electrification Authority (REA) are the two key institutions working in collaboration with the Ministry of Energy undertaking a number of projects to ensure that more districts are connected to the grid.

ERB stated that some of the projects being undertaken include the Lusaka Transmission & Distribution Rehabilitation Project (LTDRP) – Last Mile, Electricity Services Access Project (ESAP) and Sustainable Electricity Supply Southern Division (SESSD) among other projects.

When separately contacted to give the official number of districts connected to the national grid, both the Rural Electrification authority – REA and the Copperbelt Energy Corporation – CEC referred ZBT to ZESCO who had not responded by press time.

Analysts say putting up of electrify infrastructure and connecting all districts and achieving over 90% connections to the electricity national grid for all households in Zambia is as important as putting up road and other essential infrastructure necessary such as schools and hospitals for national development.

The increased allocation to REA is a welcome move which should be followed up by clear objectives such as how many districts will be connected in 2023 and what timelines are attached to when all the 116 districts are connected to the national grid. Agro development which rely on irrigation for instance and general Industrial Investments in most districts and the hinterlands of Zambia are hindered by lack of reliable source of electricity.

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Even as power utility ZESCO proposes to

Agribusiness

The Tobacco Association of Zambia – TAZ has revealed that it members expect Virginia tobacco exports of approximately $92 million p and Burly Tobacco exports of approximately $6 million (combined about $100 million)  to be earned by its member farmers as export revenues.

Speaking in an exclusive interview with the Zambian Business Times – ZBT, TAZ General Manager Adam Gordon said Virginia tobacco production increased while Burly tobacco production remained flat between 2020/2021 to 2021/2022 farming season.

Zambia exports over 90% of all its tobacco production, which Agronomists say can be economically leveraged to increase foreign exchange earnings and boost employment in the Agro sector. Zambia has the requisite good soils and weather to massively increase production and earnings from Tobacco.

The TAZ GM explained that Virginia tobacco production increased in volume from 31 million Kg’s  to 33 million Kg’s  from 2021 to 2022 whilst Burly tobacco remained constant at about 5.5 million kilograms. 

Zambia’s neighboring countries like Malawi and Zimbabwe have succeeded in making Tobacco a major foreign exchange earner. If well organized, this crop which is 90% exported makes more business sense to cultivate and can earn the farmers and the country significant amounts in foreign exchange and profits.

See other ZBT article on tobacco farming in Zambia https://zambianbusinesstimes.com/tbz-invests-in-electronic-platform-to-facilitate-tobacco-industry-regulation/ and https://zambianbusinesstimes.com/ritco-to-launch-first-cutrag-plant-in-zambia/

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The Tobacco Association of Zambia - TAZ has

Mining

The continued closure of Chambishi metals is negatively affecting the construction sector as the availability of gypsum which this mine used to produce, affects about 5 to 10% of locally produced Cement prices. Cement is a key determinant of the cost of brick and mortar construction.

Key stakeholders in the mining and construction sectors have challenged government and ministry of mines to prioritize the re-opening of Kalulushi District and Chambishi township-based Chambishi metals, a key mine that produced cobalt and gypsum in Zambia.

A mining expert has told the Zambian Business Times – ZBT that it is unfortunate that the issues around Chambishi metals have not been resolved leading to loss of much needed employment opportunities for citizens as well as government missing out on the opportunity to earn tax and non revenue.

Eurasian Resources Group – ERG put the mine on care and maintenance in January 2020 sending over 200 workers home due to what at the time they blamed as “lack of feedstock” to continue sustaining its operations.

Simukonda said it was not right to continue putting a processing plant on care and maintenance when there are enough materials in the country to be processed for both copper and cobalt. He said Chambishi Metals is a significant mine as it was the only place where significant cobalt was being processed in Zambia.

“That mine is a very significant and if government is not going to prioritize reopening the mine, then I don’t know what they are doing.” He said. “Cobalt price is about 3-4 times the price of copper now but if we can’t look after our own property or improve already existing system of cobalt processing, then I don’t know what we are doing.” the mining expert told ZBT.

He said from the onset, Chambishi metals was not supposed to be closed as it is supposed to be one of the big mines proving employment to the local communities and contributing to government revenues for the country. Government should prioritize this and press the owners and the management to consider reopening Chambishi metals.

Chambishi Metals proposed putting the operations on care and maintenance for two years because of failing to secure concentrates to keep the company going. The problem had been compounded by the some taxes that were once imposed on imports of concentrated from Democratic Republic of Congo (DRC) which were later removed.

The other challenge is that the mines based in the DRC were reluctant to export their concentrates after establishing their own smelters. Chambishi Metals is the country’s largest producer of gypsum, a key ingredient in the manufacturing of cement.

Zambia is a key Cement and Lime producer which need to source for gypsum. In the current state of affairs, cement companies resort to importing the gypsum component, which could impact final costs by about 10 to 20% depending on the prevailing exchange rates and cost of transportation. See other articles on Chambishi metals https://zambianbusinesstimes.com/govt-urged-to-seek-ways-to-re-open-chambishi-metals/

Other articles on Chambishi metals are https://zambianbusinesstimes.com/erg-challenged-to-re-open-or-surrender-chambishi-metals/ and https://zambianbusinesstimes.com/cement-price-hike-linked-to-shortage-of-gypsum-closure-of-chambishi-metals/

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The continued closure of Chambishi metals is

Markets

FNB has today at a launch event held at its head offices in Johanesburg announced the reimagining of its help and iconic acadia tree logo as it strives to make every day easier and tomorrow better for all its customers, taking a bold step forward on its journey into the future.

At revetting event attended by the Zambian Business Times – ZBT, FNB CEO, Jacques Celliers stated that “for 184 years, our sense of care has been vital to our efforts to help millions of individuals, families, and businesses realise their dreams and aspirations. Our efforts to transition beyond banking are still deeply rooted in our promise of helping customers with advice they can trust, solutions that are easy to use and safe, and a brand that is relevant at every life stage. Our journey to help customers navigate life is similar to the versatile Acacia tree, that has been deeply rooted within our brand and continues to grow and thrive withstanding the test of time.”

FNB CEO Jacques Celliers

Celliers further stated that FNB is re-imaging it’s advice. “FNB is focused on being advice-led, rather than product-led in the delivery of its solutions. In its journey to transition beyond banking, it is striving to become an integrated advice partner connecting the dots between their customers’ day to day activities and their aspirations and goals”, the FNB CEO stated.

“We aspire to be a trusted partner helping customers, their families, and their businesses thrive and achieve their goals through positive changes in financial behaviour. To this end, we want to make it easy for our customers to free up cashflow through best value for money solutions that make their money go further to realise their investment and insurance needs in line with their goals. We want to help customers through various life stages for themselves, their families and theirbusinesses, and to ensure we advise them on the right solutions for their needs,” explained Celliers.

Zambia’s FNB country Head of Retail Banking Mwamba Musambo who was one of the speakers at the Johannesburg event stated that FNB was also reimagining user experience and revamping its app.

 The FNB App, Africa’s first banking App, has been redesigned to offer even more intuitive help through its ease of use and a safer digital experience. We have listened to our customers and have set out on a journey of a new user experience underpinned by personalisation. Customers can now personalise their FNB App by customising its home screen and selecting frequently used or preferred features. Customers can also view a snapshot of their transactional accounts, credit, investments, insurance, and value-added services. In addition, the search function has been improved to help customers find services much quicker. Similar enhancements are being made to the internet banking channel.

 FNB has also introduced Money Protect, a new and industry-first benefit of free insurance cover for certain fraud-related losses when using interfaces such as the FNB App and ATMs. The benefit demonstrates FNB’s commitment to helping customers transition to safer digital interfaces.

“We continue to facilitate our customers’ journey from analogue to digital and digital to platform. We’re excited to see millions of our customers embracing the migration to more accessible, user-friendly, and safer interfaces. Our digital interfaces have become a one-stop shop for customers’ financial and lifestyle needs, with over 3 billion transactions and 1.6 billion digital interactions over the past 12 months. Likewise, we recognise that fraud is a reality in our society, and we are continuously enhancing our measures to assist millions of our digitally active customers in mitigating these risks,” says Celliers.

On Reimagining payments, the bank re-affirmed that “payments and cashflow are the lifeblood of any economy, and today we’re proud to highlight some of our unmatched standout offerings available within our digital payments ecosystem, making it more inclusive and convenient for customers to pay and get paid. The facilitation of payments for individuals and businesses is one of the key features of the power of network effects of our platform,” adds Celliers. 

FNB Pay is now the payments umbrella in the FNB App. With a few taps, customers can now split a bill and those who run businesses can receive contactless payments easily and safely on their android smart devices, without the need for a separate point-of-sale device. The new or enhanced payment solutions that are available on the FNB App include:

·        Instant Payments – a first-to-market instant payment solution that enables customers to digitally pay anyone via the FNB App using just a card number. The recipient gets the money instantly in their bank account, irrespective of where they bank.

·        PayMe – allows customers to request a payment digitally to any FNB Banked cellphone number. The person requesting the money simply follows a few prompts, and the ‘payer’ is immediately notified and simply needs to accept the request to make an immediate payment.

·        ChatPay – allows customers to pay or request payment from any FNB customer using the FNB App’s chat functionality without the need for an account number. Customers can initiate a chat using their contact list, and because the interaction takes place within FNB’s platform, they can be confident that it is safe.

·        Bill Payments – a quick and convenient way for customers to use the FNB App to pay their EasyPay or Pay@ bills including municipal rates, medical and other services.

·        Virtual Card – Customers can now use their Global Virtual Cards for travel bookings such as buying flights or booking accommodation and adding the virtual card to third-party digital wallets such as Google Wallet or Apple Pay for convenient and safer payments when traveling abroad.

·        Speedee App – allows businesses to receive contactless payments easily and safely on their android smart devices, without the need for a separate point-of-sale device.

 And FNB group Chief Marketing Officer, Faye Mfikwe stated that the bank has refreshed its iconic brand to become more versatile and resonate beyond banking and financial services. She  explained the brand’s evolution by acknowledging that change is important to staying relevant to customers. “The refresh helps us to create a versatile brand look and feel that aligns with our accelerating transition to helping customers beyond banking into lifestyle and business solutions categories”.

FNB will be holding special events across its markets in Africa  with FNB Zambia CEO Bydon Longwe expected to grace the Zambian event. 

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FNB has today at a launch event

Mining

Complaints of both water and air pollution by residents near Solwezi based First Quantum Minerals – FQMs Kansanshi mine, are on the increase, with no clear pro-active actions being taken by government authorities.

The latest complaints  have been made by resident of Ngambe in Solwezi District of Northwestern Province who have complained of water pollution caused by Kansanshi Mine and its sub-Contractors.

Confirming to the Zambian Business Times-ZBT, North Western Province Permanent secretary said his office has continued receiving complaints from local people regarding water and air pollution with the recent complaint from Mbonge village on located on eastern side of the solwezi.

North Western Permanent Secretary Gladson Katambi has since urged mining firms in the area to protect the local people from water and air pollution caused from mining and other activities. A check by ZBT shows that laws are already there but there seems to be lack of zeal in enforcement and effecting relevant penalties.

“Yesterday, people came and complained of the certain company that has been sub-contracted by [FQM] Kansanshi mine of prospecting the area, and because of the activities they are pushing the materials into the stream where people get water for from.” He said.

The PS mentioned that the water is currently in the laboratories adding that government will ensure that all measures are put in place to ensure that the people are protected.

Katambi explained that the similar situation happened in Lumwana where the mine was told to provide water bowsers, adding that the people are now drinking the water from the bowsers supplied or provided by the mines.

“It is very difficult to stop these activities because they are all over prospecting in this province and when they are drilling, they use chemicals which end up in the streams where people get water from so we are always alert so that we don’t expose our people.” He said.

Katambi said they are trying by all means to sensitize the people to immediately report such things to relevant authorities so that they don’t get exposed.

Some residents have accused local Health and Environmental officials in Zambia of being passive and will only come to life when lives are lost. When people are being poisoned by drinking contaminated water, or when chest complications in future are experienced, that’s when they want to come and diagnose the problems.

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Complaints of both water and air pollution

Companies

Standard Chartered Bank Zambia has recorded a massive 25% drop in profits following  a corresponding decrease in top line revenue. A drop in top line revenue is perhaps the most worrying trend as it indicates loss of business.

A source at the bank who spoke to the Zambian Business Times – ZBT on condition of anonymity stated that some bad decisions made by the previous CEO who has since been replaced and transferred to another country within the Banking group is responsible for the current bad results.

According to the trading statements made available to the Zambian Business Times – ZBT, the earnings per share for the six-month period ended 30 June 2022 is K0.10 compared to earnings per share of K0.13 for the six-month period ended 30 June 2021.

A further check on the half year trading results revealed that non-funded income [mostly bank fees and charges] also declined due to a drop in transaction volumes, an indicator that the new CEO Sonny Zulu has a mountain to climb.

Banks main business is to mobilize deposits and make loans, but Stanchart posted a decline in both these key parameters, loans and advances reduced by 13% year on year while customer deposits declined by 12% year on year. More analysis to follow.

 

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Standard Chartered Bank Zambia has recorded a

Companies

The multi million dollars business at Kasumbalesa Border – Zambia’s main trade route to the Democratic Republic of Congo – DRC by road servicing the entire Southern Africa countries that include South Africa, Mozambique, Zimbabwe and Namibia has come to a stand still.

This was after the Zambian Drivers opted to boycott and riot over over harassment of truck drivers and some reported killing of two drivers. The drivers were joined by youths and careers which escalated the confusion, completely disrupting trade.

A source who asked for their name to be withheld told the Zambian Business Times – ZBT that some politicians in Zambia have decided to break the long standings business model were goods from Zambia and other Southern African countries are delivered at Kasumbalesa and then Congo DR local businesspersons and transporters take over.

“These well known politicians who are also businessmen have decided to strike a deal to deliver directly in Congo DR which has put some Congolese out of business and is what is causing some of these conflicts we are witnessing. You know our friends that side take things personal when local business is affected, so they hit back”, the source told ZBT.

And speaking in a separate exclusive interview with the Zambian Business Times – ZBT, Kasumbalesa Trade Facilitation adviser Charles Kakoma disclosed that business has come to a stand still and that border has been temporarily closed because of the current protests.

“There is no activity in terms of business in Kasumbalesa and people were in homes such that gates are closed and Congolese were throwing stones from their side and also exchanging with the Zambian youths [political party cadres] and drivers.” he said.

Kakoma said the situation has however been calmed by the Zambian Paramilitary police who later intervened and quelled the situation. He said the Zambian government and Congo government should quickly address the the issue at Kasumbalesa.

“This problem has been persisting year after year for a long time now, so I suggest that Congo DR should give security to the Zambian and other foreign drivers trucking or delivery cargo in Congo to give confidence to the drivers.”

Efforts to get a comment from the Minister of Trade proved futile by press time. Expectations are however high that the issues will be resolved as this stand off is disrupting business not only in Zambia and Southern Africa, but East Africa as well as Tanzania also exports to DRC via Kasumbalesa.

The Ministry of Transport is also affected as traffic congestion continues to build up which is making businesses spend more on demurrage cost, delays in delivery and escalated labour costs of the affected drivers

 

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The multi million dollars business at Kasumbalesa

Mining

The Zambia Chamber of Mines says the 2023 Budget announcement is an encouraging move towards the re-establishment of Zambia as a key mining investment destination. Zambia currently ranks second to its northern neighbor – Democratic Republic of Congo as Africa’s second larget copper producer.

Zambia Chamber of Mines Chief Executive Officer – CEO Sokwani Chilembo said the Budget measures are likely to be viewed as an encouraging move and a boost to attraction of Zambia as a top mining investment destination.

Chilembo told the Zambian Business Times – ZBT that the Chamber of Mines has long advocated for the dismantling of excessive unfavourable mining tax policies that were previously introduced, leading to a slowdown in mining investment inflows.

“The announcement builds on the momentum sparked by initial steps taken in the 2022 budget, which ushered in a first wave of investments being announced this year, including First Quantum’s S3 expansion at Kansanshi, and the development of Enterprise, which will become Africa’s largest nickel mine when it is operational next year.” He said.

Chilembo said amending the mineral royalty tax to be calculated on an incremental or sliding scale basis will start to bring Zambia’s tax regime back in line with other mining countries.

“We have long identified the royalties’ regime as a stumbling block for investment into Zambia. Not only are our rates higher than any of our competitors, but the regime operated in a way that deterred miners from producing at higher prices which was ultimately harmful for everyone. We are pleased to see the Government follow through on its promise to reform some of these impediments to growth” The Chamber of mines chief stated.

Similarly, the Chamber applauded the measures promoting exploration and artisanal mining as well as the establishment of a mining regulatory institution arguing that investors wanted to see a fully capacitated regulator that could manage its administration in a timely and effective manner.

“The measures announced will start to bring Zambia back in line with the rest of the mining world – we now have a case to market to the world’s investors. We all need to study the numbers, to see how these measures shift the effective tax rate and how that compares with our competitor jurisdictions.

The Chamber of mines told ZBT that its members and the global mining investment community will study the implications in detail. “But we can confidently say that this has been a good day for Zambia’s mining industry and, by extension, for the country’s future economic trajectory.”

It however remains to be seen if the mining companies will reciprocate the gesture from the Zambian government by confirming new and medium term investment plans as corcerns are emmerging that Zambia may end up lossing both on annual tax revenues and attracting the right levels of investments to hit the  million tons per annum copper production target in now 9 years time.

 

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The Zambia Chamber of Mines says the

Companies

One of Zambia’s leading audit, accounting, taxation, management and consulting firm – BDO Zambia, a part of BDO international network on Saturday 1st October 2022 held a cocktail in Lusaka to give high level highlights and analysis of the 2023 national Budget.

The event was attended by representatives from the Zambia Revenue Authority – ZRA, the Ministry of Finance officials, BDO clients and other special invited guests among key stakeholders with the aim to discuss and engage in the detailed analysis of the 2023 national budget.

According to the BDO Zambia Budget overview, the 2023 budget address by Finance Minister Dr. Situmbeko Musokotwane was delivered on the back drop of a fiscal year characterized by change in all facets of the economy.

The firm acknowledged the upward trajectory of the economy as well as numerous positive performances of the key economic indicators. These provide evidence of the compounding ripple effects of the shift in Governance, police direction and policy implementation.

Moderator for the event – Jonathan Ambali who is BDO Associate Director stated that although the state of the economy has strengthened investor confidence and greatly improved creditor relations, the road map described in the 2023 budget seek to address the challenges that are still notable going forward.

The co-presenters on half of BDO – Kafume Mbewe who is senior Tax Manager and Lungowe Masuku who is Tax Manager  shared some of the key budget  highlights for 2023.  Highlights were given under direct taxes, value added tax, customes and excise as well as the tax amnesty.

At the same event, ZRA requested that BDO works hand in hand with the Taxation authority regardinf the implematation of the tax amnesty. According to the 2023 National Budget, the Minister of Finance Dr. Situmbeko Musokotwane announced a tax amnesty that will run from 1st October 2022 to 31st March 2023 and will apply to all tax type.

ZRA Commissioner Indirect Tax – Moses Shuko called for support from the BDO who have been partners for quite some time. He said the idea of putting in place a tax amnesty is to give a fresh start for tax payers as a way of ensuring that there is compliance going forward when it comes to tax collection.

“Our appeal to BDO is that lets work together in ensuring that we achieve this goal”, Shuko said. He however urged taxpayers to take advantage of the initiative before the penalties and interest are reinstated on 1st April 2023.

BDO presently has 5 partners and over 100 professional and administrative staff at its Lusaka offices. In addition to its own team of financial experts, the firm has a number of qualified professionals providing advise on matters such as Human Resources Management and Legal Draftsmanship.

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One of Zambia's leading audit, accounting, taxation,