Companies tax, VAT top 2020 net revenue collections

ZIMBABWE’s annual net revenue collections grew by 6,22 percent to ZWL$182,59 billion last year underpinned by fiscal and monetary measures that ushered in the much-needed stability and enhanced businesses viability.

The major contributors to the tax revenues were companies with $34,132 billion, followed by VAT at $33,519 billion and individual income tax contributions at $28,438 billion.

Excise duty brought in $25,824 billion and customs duty $14,573 billion.

The Zimbabwe Revenue Authority (Zimra) had projected annual net revenue collections of ZWL$171,90 billion in 2020.

In a revenue performance report for the quarter ended December 31, 2020, the tax collector also posted an 8,44 percent rise in net revenue for the fourth quarter recording ZWL$91,51 billion.

“The authority collected net revenue of $182,59 billion against a target of ZWL$171,90 billion for the year ending 31 December 2020 and this translated to 6,22 percent above target.

“Gross collections for the quarter were ZWL$94,28 billion, translating to 11,72 percent above the targeted ZWL$84,38 billion,” said Zimra.

“After deducting refunds of ZWL$2,77 billion, net collections stood at ZWL$91,51 billion. This resulted in a positive variance of 8,44 percent against target.”

Commenting on the overall tax revenue collections, Zimra said 2020 ended on a positive note as the fourth quarter and annual tax revenue collections surpassed the revised targets.

The tax collector said this was despite the dark cloud of the Covid-19 pandemic, which engulfed Zimbabwe and the rest of the world.

“A cocktail of fiscal and monetary measures introduced by the Government brought about the much-needed stability that enhanced businesses viability and bolstered revenue inflows.

“This was augmented by the authority’s revenue enhancement strategies and an effective business continuity plan that ensured safety of both staff and clients,” it said.

During the period under review, which marked the end of the two-year Transitional Stabilisation Programme (TSP), Zimra said it strategically focused on supporting the programme in three areas namely, restoration of fiscal balance, ease of doing business and plugging of revenue leakages.

Under the National Development Strategy 1 (NDS1 2021-2022), Zimra would continue supporting the economic growth and stability pillar through strengthening the above strategic focus areas.

In light of the Covid-19 pandemic, the revenue authority said the convenience and safety of staff and the tax-paying public continued to be a top priority.

“The authority has fully embraced the digital edge hence the implementation of different platforms for the taxpayers to interact and transact with Zimra.

“To this end, the electronic cargo manifest system is facilitating an efficient and effective way of clearing commercial traffic hence easing border congestion,” Zimra said.

On plugging of revenue leakages, Zimra said the risk of revenue leakages within and outside ports of entry continued, particularly just before and during the festive period, and the authority stepped up its efforts to plug these leakages.

It said collaborative operations were done with relevant stakeholders such as the Zimbabwe Anti-Corruption Commission (Zacc), Vehicle Inspectorate Department (VID) and the Zimbabwe Republic Police (ZRP).

“Unfortunately, lockdowns instituted to contain the spread of the Covid-19 pandemic have led to increased smuggling of goods through the country’s porous borders.

“Joint patrols with security arms of state were conducted to plug such leakages,” said Zimra, adding that internally, lifestyle audits were carried out and corruption cases investigated as the authority maintains zero tolerance towards corruption.”

Going forward, it is hoped that the tax collector will continue with its business continuity plan and efforts to ensure Zimbabwe has adequate resources to finance public expenditure in critical areas of social service provision and infrastructure development.

In the 2021 fiscal year, Zimra targets to mobilise ZWL$387,4 billion and some of the measures to expand the tax base through the informal sector are contained in the 2021 fiscal policy statement. —-chronicle.co.zw