The Sunday Mail
Darlington Musarurwa Business Editor’s Brief —
IF ever there was need for evidence to highlight the extent to which the Zimbabwe Revenue Authority has been culpable of significant revenue leakages — especially under the old guard — one simply has to look at the headlines in the last 14 months.
Police statistics show that in eight days between January 2 and January 10 last year, more than 257 bales of second-hand clothes were seized, 136 of them in Marange, Manicaland province.
But the contraband was only accounted for after action-packed, movie-style drama. Police details who had been tipped off on the two trucks that were going to transport the wares through Forbes Border Post unsuccessfully tried to flag them down.
One of the vehicles sped off and made good its escape, while the other truck, whose front tyre was deflated by a gunshot, veered off the road.
The truck driver, however, bolted into the night. The same drama was to repeat itself again in the capital on May 31, 2016 when a truck driver – Mandlaenkosi Dube — who was purportedly carrying bananas was stopped for a routine check by the Vehicle Inspection Department.
Dube tried to escape when the officers tried to commandeer the truck to VID’s Eastlea depot. He was not so lucky and was arrested after ramming into the VID patrol truck.
His consignment, which included 296 bales of second-hand clothes and 32 bales of second-hand shoes, was valued at US$131 200.
Perhaps the biggest scandal so far has been the confiscation of four tankers supposedly carrying 140 000 litres of diesel to the Democratic Republic of Congo on January 30 this year.
Zimra officials at Chirundu Border Post only discovered that the trucks were in fact filled with water after the contents had been offloaded somewhere between the two transit points.
The alleged smugglers potentially prejudiced Zimra of more than US$56 000. Notably, the Electronic Cargo Tracking System (ECTS), which was installed on January 1, 2017, had alerted the authorities of a possible offence.
From the sheer value of the recovered consignments it can be easily inferred that those responsible for the offences are not small-time criminals. They are obviously people of means prejudicing the revenue authority on a an industrial scale.
Last year, by Zimra’s own admission, revenue collections during the first seven months of the year, grew by 50 percent from a year earlier after most fiscal devices that had curiously been installed by retailers five years earlier were connected to the Authority’s servers.
But the slow pace by Zimra in rolling out ECTS and fiscalisation, which directly impacted on national revenues, is worrying and has to be subject to enquiry.
Government made fiscalisation — which entails the use of tamper-proof fiscal tax registers that transmit real-time data to Zimra’s servers — legally enforceable by gazetting Statutory Instrument 104 of 2010 on June 8, 2010.
Five years later the project looked to have been aborted. The 2010 National Budget proposed to introduce ECTS on April 1, 2010, but the project only took off on January 1 — a full 2 467 days (six years and nine months) after it should have been operational.
It is only after the appointment of Mrs Willia Bonyongwe as Zimra chair on June 29, 2015 that the proposed reforms began to gain traction.
Fiscalisation has been expanded to include businesses that generate more than US$60 000 per annum, which should naturally increase compliance and improve revenue collections.
Senior executives, including Commissioner General Mr Gershem Pasi, have been suspended and are facing various disciplinary procedures.
It is these executives who wittingly or unwittingly superintended over an inefficient tax collection system. It will be interesting to establish how much Government was prejudiced of in the period that tax compliance systems were not implemented.
Mrs Bonyongwe’s statement accompanying the 2016 revenue performance report is particularly interesting.
“The failure to surpass revenue targets in 2016 is not largely due to the prevailing harsh economic conditions but, like indicated previously, in unwillingness to meet tax obligations by economic agents.
“If Zimbabwe is to develop, there is need for a paradigm shift in the way we view this obligation across the board. Zimra has started but is still a long way from fully implementing its efficiency and compliance measures.
“But there has to be a concerted effort by all stakeholders to ensuring that we can sufficiently fund our roads, man and equip our hospitals and schools and pay our civil servants adequately and on time.
“We also need to have a significant surplus for capital investment and we in Zimra believe that is achievable. We cannot afford to have enclaves who do not pay tax,” she said.
In life there is nothing more certain than death and taxes. In some jurisdictions, paying taxes is sacred, while evasion — on the other hand — is considered a capital offence.
Officials culpable of wholesale tax evasions either by omission or commission, especially at a time when the country’s coffers are running on empty, have to face the music.
In this case, in the worst-case scenario, disgraced officials will get nothing more than a dismissal, a slap on the wrist and a golden handshake.
But as the Americans say, when there is blood on the streets somebody has to go to jail.
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