Business has called for a more structured and risk-based approach to tax audits, arguing that prolonged and overlapping reviews are disrupting operations and diverting attention from production and investment.
The concerns were raised during the Business Membership Organisations (BMOs) engagement with the Minister of Industry and Commerce last month, where industry representatives outlined several issues affecting the operating environment.
In its submissions, the Zimbabwe National Chamber of Commerce (ZNCC) said while the private sector fully recognised the importance of tax compliance and revenue mobilisation, there was growing concern over the frequency and scope of audits being conducted by the Zimbabwe Revenue Authority (ZIMRA).
“The chamber would also like to raise concerns regarding the frequency and scope of audits conducted by the Zimbabwe Revenue Authority,” ZNCC said.
“While we fully recognise the importance of tax compliance and revenue mobilisation, there is growing concern about continuous and overlapping audits, some of which date back as far as 2021.”
According to the chamber, some firms are required to commit substantial financial and human resources to responding to repeated audit queries, often covering periods that had already been reviewed.
“These audits are becoming increasingly disruptive to business operations,” the ZNCC said.
“Firms are required to dedicate significant time and resources to responding to repeated audit queries, often covering historical periods that have already been reviewed.”
The chamber said the situation was affecting operational efficiency in some sectors and, in certain cases, delaying business decision-making processes.
“This diverts management attention away from core productive activities, affects operational efficiency, and, in some cases, delays decision-making and investment,” it said.
The organisation proposed what it described as a more predictable and targeted framework for tax reviews.
“We respectfully propose that there be a more structured and risk-based approach to audits,” the chamber said.
“This could include limiting the frequency of audits within defined periods, prioritising current tax years and strengthening coordination within the revenue authority to avoid duplication.”
The chamber also suggested that greater adoption of digital systems and pre-assessment reviews could help reduce prolonged physical audits while maintaining compliance standards.
“Greater use of digital systems and pre-assessment reviews can also help resolve issues without prolonged physical audits,” the submission noted.
Industrialist Dr Nxaba Ndiweni said the concerns raised by industry reflected the need to strike a balance between effective revenue collection and sustaining productive economic activity.
“Revenue authorities everywhere have a responsibility to ensure compliance and protect the tax base, particularly in economies facing fiscal pressures,” he said.
“At the same time, the auditing process should ideally be designed in a way that minimises unnecessary disruptions to productive sectors of the economy.”
Dr Ndiweni said predictable and coordinated compliance systems were important in improving investor confidence and supporting business expansion.
“What businesses are looking for is not the removal of audits, but greater efficiency, consistency and coordination in how those audits are conducted,” he said.
He added that digitalisation could play an important role in modernising tax administration while reducing administrative burdens for both companies and the tax authority.
“Globally, there is increasing movement towards data-driven and risk-based auditing systems. Those systems can improve compliance outcomes while also reducing operational strain on compliant businesses,” said Dr Ndiweni.
The ZNCC said its position was that compliance and productivity should reinforce each other rather than operate in conflict.
“Our view is that compliance and productivity must be mutually reinforcing,” ZNCC said.
“A balanced approach will support revenue collection while allowing businesses to focus on growth, investment, and job creation.”
The engagement formed part of an ongoing structured dialogue between the Government and the private sector aimed at improving policy coordination and strengthening Zimbabwe’s industrialisation agenda.-herald
