LIVINGSTONE MARUFU
The country’s tax collector, the Zimbabwe Revenue Authority (ZIMRA), is in a catch 22 situation amid fears that excessive taxes imposed on ordinary people and small businesses may turn the majority against the political elites.
While ZIMRA is pressed to collect tax and finance key programmes including payment of the restive civil servants, itself a thorny issue affecting the workers, ruling Zanu PF and opposition Citizens Coalition for Change (CCC) legislators have brought the authority under fire as their vicious taxes are antagonising people and small business operators.
The Treasury reportedly advised ZIMRA to collect ZWL$53.9 trillion this year without fail as that money is used for civil service payments including the top chefs’ salaries and benefits.
Resultantly, ZIMRA is taxing those that are easily accessible to the marrow in a move that has since united politicians across the political divide as the tax collector has threatened to hit their home ground.
“We have been campaigning and praising the good policies of the Second Republic but the recent taxes will send a wrong message to the electorate as the taxes are punitive and are anti-people,” a Zanu PF legislator told the Business Times this week.
“We will certainly push for the reversal of this move as we can’t see the rural folk being taxed like this during these trying times. The rural people are fighting effects of El Nino induced drought and ZIMRA comes with its taxes to increase the burden,” he added.
“If you charge a hair salon operator US$300 per month how would she or he continue to be operational? These are astronomical charges. They should put a fee that enables the public to comply not to go underground. If we are the government of the people by the people and for the people, why are we doing this to our people? If we let this happen, how can we convince our people next election time?”
The next elections are due in 2028.
ZANU PF legislators claimed that they have had an audience with ZIMRA commissioner general Regina Chinamasa who also confirmed the authority was under pressure to meet the set target by her principals.
A CCC legislator told this publication that the chickens came home to roost following bad policies by the administration.
“We have been telling the ruling party colleagues that their policies are not for the people but for the few who are also exempted from such taxation. They are now complaining about the taxes when they are the ones who voted for the taxes to be increased. But for the betterment of our people, through the Portfolio Committee for Budget, Finance and Investment Promotion, we will have a chat with ZIMRA in the parliament to enlighten the tax collector on how devastating their taxes are to the emerging businesses and ordinary people,” he said.
Responding to an inquiry sent via email, Chinamasa said the tax collector will execute its duties as mandated by the law.
“ZIMRA is an entity established by the Government of Zimbabwe to collect revenue for the State. Therefore, carrying out one’s duty should not be considered as being put under pressure. We carry out our mandate as required by the Constitution and Taxes Acts,” Chinamasa told Business Times.
“Informal traders have always been included in the tax laws under presumptive taxes. What has just happened is that the Government of Zimbabwe and ZIMRA strengthened the drive to enforce and support these taxpayers’ compliance. ZIMRA recognises the importance of ensuring fairness and equity in tax collection, including from unregistered businesses operating within the informal sector,” she said.
“It is expected that compliance must be voluntary and ZIMRA intervenes where one fails to adhere to the law. The tax laws indicate who is supposed to register and pay tax meaning our role is to support that process.”
“The role of the Authority includes advising and implementing tax laws of the land with all fairness as required by the law. The Authority implements a number of programmes aimed at supporting taxpayers to comply even though compliance is expected to be voluntary. ZIMRA participates in various inter-stakeholder activities aimed at supporting formalisation of the sector and even financial inclusion,” she added.
Chinamasa said the Authority has segmented taxpayers by size in order to provide service relevant to status.
ZIMRA has opened offices throughout the country to provide a service where taxpayers are and tax education campaigns are carried out for all taxpayers without regard to size.
Chinamasa said the Authority has put in place several measures to ensure the US$53.9 trillion target is achieved.
“To effectively collect revenue from these unregistered businesses, ZIMRA is implementing a multi-faceted approach: we engage the taxpayers directly and through their associations to provide information and encouragement, from 2023 we have implemented the Block Management System and this process shall continue. The System involves monitoring and visiting taxpayers continuously on their specific places of business to educate, support and enforce payment of taxes and we have opened tax Kiosks in major centres of the authority where computers are availed for use when submitting returns,” the ZIMRA boss said.
She said a contact centre was opened in 2023 to attend to queries on tax matters which taxpayers can take advantage of.
“The new Tax and Revenue Management System rolled out in October 2023 is aimed at simplifying tax processes from registration to account management and we shall implement the legislation on addressing the integrity of the value chain. There is guidance on who can buy from a manufacturer, or wholesaler and information maintained by these shall be used for tax purposes,” Chinamasa said.
