PHILLIMON MHLANGA
Finance Minister Mthuli Ncube has instructed the Zimbabwe Revenue Authority (ZIMRA) to expedite processing of outstanding value added tax (VAT) refunds and requests for extension of the time period within which tax is payable without accruing interest and penalties by companies experiencing coronavirus-related cash-flow challenges.
Outstanding VAT refunds estimated to be more than ZWL$100m, have thrown several companies into financial turmoil as this created cash-flow problems.
The situation could be worse due to the ravages of coronavirus also known as COVID-19.
But, Ncube said the latest instructions to ZIMRA were part of government interventions, in line with President Emmerson Mnangagwa’s call for measures to mitigate the impact of Covid-19 on Zimbabwe.
The normal process for tax refunds is that it should be paid within 60 days.
But, ZIMRA has been ignoring the regulations even though failure exacts interest payment to the registered operator on the outstanding amount.
“Delays in processing of VAT refunds continues to affect businesses cash-flows and in some instances compelling businesses to contract expensive short-term funding,” Ncube said.
He added: “Treasury will ensure that ZIMRA expedites processes on refunds and request for extension of the time period within which tax is payable without accruing interest and penalties for companies that shall experience COVID-19 related cash-flow challenges.
In this regard, ZIMRA is working on a program to expedite processing of VAT refunds from the statutorily prescribed 60 days.”
