ZIMRA must evolve or be swallowed by the cash economy

The Zimbabwe Revenue Authority (ZIMRA) finds itself at a crossroads.

On paper, the numbers appear encouraging: ZWG76.4bn collected in the first half of the year, marginally ahead of target. Yet beneath these statistics lies a growing crisis that threatens to hollow out Zimbabwe’s revenue base — the unrelenting dominance of the cash economy, rampant informality, and the worrying escalation of corporate tax disputes.

The warning signs are glaring. When blue-chip firms like Delta Corporation and Innscor Africa — with their extensive compliance departments and sophisticated systems — find themselves locked in protracted tax battles, it exposes a chilling truth: the weaknesses in ZIMRA’s audit and enforcement capabilities are systemic, not isolated. If ZIMRA struggles to untangle the tax affairs of listed giants, what hope exists for tracking revenue leakages across the sprawling, unregulated informal sector where over 70% of economic activity hides beyond the reach of formal banking channels?

ZIMRA Commissioner General Regina Chinamasa has been refreshingly candid in her assessment. She acknowledges that the tax authority’s investigative capacity remains limited, its systems strained, and its ability to track cash transactions severely undermined. The implications are profound. Without bold, technology-driven reform and a relentless commitment to realigning tax enforcement to on-the-ground realities, Zimbabwe risks losing the revenue war — not just against street vendors and small traders, but against an entire economic culture that thrives on opacity.

The introduction of the Zimbabwe Gold (ZWG) currency was supposed to restore confidence in formal financial systems and reduce cash dependency. Yet, cash remains king — not only in informal markets but also in the boardrooms of established corporations. This entrenched preference for cash creates blind spots that even the most well-intentioned tax policies struggle to illuminate.

The voluntary disclosure window for smuggled vehicles is a creative initiative — the proverbial carrot before the stick — but its success will be limited if ZIMRA lacks the tools, manpower, and technological infrastructure to enforce compliance systematically. The same applies to sector-based audits and targeted enforcement drives. Without real-time data, advanced analytics, and artificial intelligence powering investigations, these efforts become reactive at best and futile at worst.

The reality is simple yet harsh: Zimbabwe’s tax authority cannot outmuscle the cash economy with outdated tools, manual audits, and reactive policy tweaks. The cash economy is fluid, adaptable, and constantly evolving. ZIMRA must be the same — agile, technologically equipped, and driven by real-time intelligence.

Artificial intelligence, data mining, and integrated digital platforms are no longer optional — they are essential weapons in this fight. But digital tools alone are not enough. There must also be parallel investment in skills development within ZIMRA. Data is only as useful as the capacity to interpret and act on it. That requires a workforce of forensic auditors, data scientists, and investigators equipped not only with technical expertise but with the resources and autonomy to follow complex transactions to their conclusion — whether those transactions unfold on the street corner or inside the boardrooms of Zimbabwe’s largest corporations.

Yet, even the most sophisticated enforcement regime will falter without broader structural economic reforms. The dominance of informality is not merely a tax problem — it is a symptom of deeper issues: a lack of trust in the financial system, policy inconsistency, and an economy still grappling with currency volatility and limited access to affordable banking services.

Therefore, while ZIMRA must evolve, government policy must evolve in tandem. Formalising the informal sector requires more than punitive measures; it demands incentives, accessible financing, and the creation of an economic environment where formal participation is not only viable but desirable.

The stakes could not be higher. Tax revenue funds public services, infrastructure, and economic development. When the tax net is riddled with holes — whether through corporate disputes, informal trading, or cash opacity — it is the ordinary citizen who ultimately pays the price through crumbling services and economic stagnation.

ZIMRA’s current predicament is a wake-up call. The tax wars with corporate giants, the quiet panic among businesses, and the stubborn resilience of the cash economy are not isolated crises — they are symptoms of a system at breaking point.

For Zimbabwe to chart a sustainable fiscal path, its tax authority must not only keep pace with economic evolution — it must be a step ahead. That means embracing technology, upskilling its workforce, deepening collaboration with other regulatory agencies, and advocating for economic policies that shrink informality and rebuild trust.

The cash economy may be a formidable adversary — but with agility, technological investment, and relentless evolution, it need not be an insurmountable one.