The Sunday Mail
Livingstone Marufu —
GOVERNMENT has gazetted Statutory Instrument 148 of 2016 which will see retail operators and other small businesses paying value added tax from effect January 1, 2017 as part of measures to broaden the country’s revenue base.
This comes as the Ministry of Finance has attributed the Zimbabwe Revenue Authority (Zimra)’s quarterly under-performance to tax avoidance and corruption.
In a Government Gazette released last week, in terms Section 78 of the VAT Act (Chapter 23:12), from January next year, every registered operator who is a retailer operator shall, for the purposes of recording his or her taxable transactions use a fiscalised electronic register and a non-fiscalised electronic register together with a fiscal memory device.
Presenting the 2017 National Budget last week, Finance Minister Patrick Chinamasa said there was need to bring in new machines to improve revenue collection methods.
Government introduced the fiscalisation programme in 2010 with a view to plug loopholes in the VAT system, thereby enhancing revenue collections.
Minister Chinamasa said though the programme was anchored on the use of approved devices, most of the machines are now outmoded.
“Most of the devices that were approved at the commencement of the fiscalisation programme are now outdated.
“It is, therefore, proposed to authorise suppliers of fiscalised devices to procure advanced fiscal devices.
“Currently, 10 companies are licensed to supply fiscalised devices, of which four are no longer operational. This has constrained the supply of fiscalised devices, thereby undermining progress of the programme,” he said.
Additional suppliers of fiscalised devices are therefore expected to licensed to complement existing suppliers in meeting the anticipated demand for fiscal devices that will arise from the extension of the fiscalisation programme to operators in categories A, B and D.
Minister Chinamasa said about 90 percent of Category C operators have already acquired fiscalised devices. However, connection to the Zimra server has been slow due to resistance by operators.
Non-compliance by operators has undermined Zimra’s ability to monitor vatable transactions in real time.
Said Minister Chinamasa: “In order to ensure compliance by category C operators, non-compliant operators will not be issued with Tax Clearance Certificates.
“This implies that operators will be subject to a withholding tax of 10 percent of the gross value of sales.” It is understood that about 4000 huge companies are operating outside the tax bracket.
Zimra Board chairperson Mrs Willia Bonyongwe believes citizens have a lot of money “somewhere in the country”, considering the way “mountains are being cut to construct state-of-the-art houses” and the top-of-the-range vehicles being driven.
To improve revenue generation, Zimra says it is increasing its efficiency, effectiveness and enforcement, largely through automation and increased compliance.
The revenue collector is working on introducing advanced border and port of entry security systems to monitor the movement of goods across borders.
The advanced security system includes electronic cargo tracking system, non-intrusive inspection systems like sniffer dogs, joint border patrols with other security agencies, cargo escorts, CCTV and commercial clearance of private imports transported by hired carriers.
