Bread Price Goes Up, Again
The price of bread has gone up again by 20% from last month following a raft of new taxes introduced by the Minister of Finance, Economic Development, and Investment Promotion Mthuli Ncube.
The price of bread is now $US1.20, up from US$1.00 just a fortnight ago.
Retailers increased the bread prices early this month to between US$1.10 and US$1.20 but reverted to the old price a few days later.
However, the price of bread has gone up again to US$1.20 and between $10 000 and $11 000 in some major supermarkets in Harare.
Speaking to The Standard, Confederation of Zimbabwe Retailers (CZR) president Denford Mutashu attributed the increases to movements in the exchange rate. Said Mutashu:
The increase is on the supply side which has captured the movement of the exchange rate both on the official and unofficial markets.
Some tuckshops are selling bread at US$1.20 while some traders in high-density suburbs are charging US$1.10 for a loaf of bread.
Grain Millers Association of Zimbabwe (GMAZ) president Tafadzwa Musarara told The Standard:
We have not increased the price of wheat. You will have to talk to the National Bakers’ Association of Zimbabwe (NBAZ) to understand why the price of bread has gone up.
NBAZ president Dennis Zinyama attributed the price increases to the new taxes introduced by the Treasury. He said:
Previously, when bread was zero-rated as a taxable supply, bread manufacturers could claim, from the Zimbabwe Revenue Authority, input tax charged on production and distribution costs.
Bread manufacturers were, therefore, not factoring these costs into the pricing of bread.
In the new Finance Act, bread has been changed to an exempt supply status, implying that input tax is no longer claimable.
Consequently, manufacturers are compelled to incorporate the tax portion into the cost of production and distribution.
The price increase comes as the Government, which is the biggest employer in the country, reduced civil servants’ earnings by taxing their US$300 allowances that have been converted to taxable salaries.
More: Pindula News
