Zimra won't write-off the $3.9bn owed by companies

Zimra won't write-off the $3.9bn owed by companies
Published: 14 February 2018
ZIMBABWE Revenue Authority (Zimra) will not write-off the $3,9 billion it is owed by companies and councils, as this will set a bad precedent of not paying dues, a top executive told a parliamentary portfolio committee on Monday.

Zimra commissioner for domestic taxes, Happias Kuzvinzwa told a Parliamentary Portfolio Committee on Finance and Economic Development that the authority has negotiated with organisations which have debts to come up with a payment plan.

"If we write-off, what message do we give to those who are compliant? Yes, if we force them to pay today they will collapse, but if we come up with a payment plan, they will know that they will pay up," Kuzvinzwa said.

Of the $3,9 billion, the private sector owes the taxman $3 billion, parastatals ($490 million) and councils ($232 million).

Zimra's net collections for 2017 were $3,75 billion, which surpassed the target of $3,4 billion.

The revenue collection contributes 27% of the country's GDP, well above South Africa, Botswana which stood at 25%.

"We exceeded target with a level which we didn't do for the past four years, given the harsh economic environment. We did quite well in line with new dispensation we can safely that the strength of any government is seen by its capacity to mobilise resources, " Kuzvinzwa said.

Zimra board chairperson Willia Bonyongwe said when the $4 million electronic cargo system was put in place, there was a 60% decline in transport, meaning that most of them were smugglers.
She said the taxman has collected

$12 million in fines, with 159 agencies being deregistered for providing false information.

Legislator Eddie Cross asked why a case of trucks which smuggled fuel was not prosecuted, to which the Zimra officials said the matter was under police investigations.

Cross requested Zimra to submit the police case number to the committee.

His request comes after Zimra last year intercepted four tankers carrying about 140 000 litres of diesel that was ostensibly in transit to the Democratic Republic of Congo, but illegally offloaded in Chitungwiza and replaced with an equal quantity of water.

Cross bemoaned the smuggling of goods at port of entry, adding that it was a pity that the country which has $6 billion imports was collecting $390 million from import-related taxes.

Zimra commissioner-general Faith Mazanhi said that they will embark on a tax gap analysis to determine how much each sector of the economy contributes depending on activity.
- Newsday
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