Treasury cracks the whip

LIVINGSTONE MARUFU

Treasury has issued an ultimatum to all government departments and agencies to fully automate their revenue collection systems by the end this year, in a push to boost efficiency, curb leakages and entrench fiscal discipline across the public sector.

The directive, which includes a March deadline for the Zimbabwe National Road Administration (Zinara), comes as the government seeks to build on a sharp improvement in revenues recorded in 2025 following the rollout of digital tax systems by the Zimbabwe Revenue Authority (ZIMRA).

At the centre of the drive is the successful implementation of the Tax Administration and Revenue Management System (TaRMS), which Treasury says has materially enhanced tax collection efficiency and broadened the tax base through digital tools.

Finance, Economic Development and Investment Promotion permanent secretary George Guvamatanga said automation across ministries, departments and agencies (MDAs) was now non-negotiable.

“I have given the Zimbabwe National Road Administration (Zinara) up to March to fully automate. And all the other government departments and agencies by the end of the year. The elimination of all manual processes will boost efficiency on revenue collection, transparency, and strengthen fiscal discipline across all Ministries, Departments, and Agencies [MDAs],” Guvamatanga said.

He added that Treasury was already tightening controls at revenue-generating agencies.

“At Zinara, we are tightening more screws in terms of revenue collection and we are bringing in new tolls to increase revenue to the fiscus.”

The automation push is part of a broader strategy to widen the tax base and reduce losses historically linked to manual systems, weak controls and opaque processes. Alongside revenue reforms, Treasury has also rolled out an electronic Government Procurement (e-GP) system aimed at streamlining public procurement and limiting abuse.

Economist Tinashe Murapata warned that the burden is becoming unsustainable for compliant businesses and individuals.

“If the economy is only growing at 5%, why is it that the tax is at around 18% of the Gross Domestic Product? This suggests the government is taking a bigger slice from the formalised entities,” Murapata said.

Guvamatanga rejected claims of over-taxation, arguing that recent revenue gains reflect efficiency rather than higher tax rates.

“Government is slowly getting its cake that the companies and individuals used to eat. The 18% growth does not reflect that we have gone on all tax lines. There is some credit you need to give to the government and ZIMRA because most of that growth,” he said.

He pointed to the 2026 National Budget as evidence that policy is tilted towards supporting industry.

“If you look at the 2026 budget, 70% of the budget are tax reductions where we are trying to promote industry. It’s only three or four lines which we have reviewed upwards, one of which we have reviewed on royalties which we said is too aggressive. This is coming from efficiency tax collection,” Guvamatanga said.

Treasury traces much of the turnaround to reforms introduced two years ago, when government completed the installation of a new tax collection management system supported by the African Development Bank.

The state is targeting about US$10bn in revenue collections this year, with Treasury also moving to rationalise tax expenditures and exemptions.