Zimbabwe’s net revenue collections grew by 118,9 % to $5,06 billion in the first half of the year from $2,41 billion collected last year driven mainly by the 2% intermediated tax on money transfers and excise duty, the tax agency reported.
By Business Reporter
The Zimbabwe Revenue Authority (Zimra) had set a target of $4,3 billion.
“Revenue performance for the first half of 2019 exceeded the set target on both gross and net positions. Gross collections for the first half of 2019 were $5,27 billion against targeted $4,30 billion, thereby surpassing the set target by 22,75%.After deducting refunds of $211,52 million for the first half, net collections of $5,06 billion surpassed the target of $4,3 billion by 17,83%,” Zimra chairperson Callisto Jokonya said in a statement.
Individual tax grew by 59,3% from $416,4 million last year to $663,6 million as at the end of June this year.
Company tax was up 62% from $356,3 million to $578 million.
Vat on local sales also went up 63,3% from $527,1 million to $861 million. Vat on imports also firmed 89,5% from $252,6 million to $478,7 million.
Gross customs duty increased 63,3% from $198,5 million to $324,3 million .
Tax collections on intermediated money transfer tax amounted to $671,6 million from $8,4 million, while excise duty grew 181,9% from $451,6 million to $1,27 billion, buoyed by fuel imports.
“Revenue collections from individual tax and company tax can be attributed to the ongoing revenue enhancement initiatives that the authority is undertaking. One project pursued focused on PAYE in foreign currency and has had significant impact, especially during the month of May when the project started,” Jokonya said.
According to a recent survey conducted by the Zimbabwe National Chamber of Commerce, the current tax system is characterised by too many tax heads, with very high tax rates compared to other countries.
The study notes that a business operating in Zimbabwe will have to make at least 51 payments for it to be considered to be compliant with its tax obligations.
This comes at a time when fiscal authorities in the country are trying to widen the reach of the tax collector in order to shore up depleted government coffers.
Last October, the tax levied on financial transactions was increased to 2% per transaction in an attempt to net in small informal businesses which have largely gone undetected by the tax man for a while. This sector constitutes an estimated 40% of the country’s economy.
Zimbabwe solely depends on tax revenue to fund its entire budget after it was shut out by international financial institutions for failing to pay up its debts.