ZIMRA REVIEWS TAX REGIME SMEs to be part of revenue boost
THE Zimbabwe Revenue Authority (Zimra) has begun the process of reviewing the country’s tax system to accommodate small to medium enterprises to boost domestic revenue, a senior official said yesterday.
Zimra Commissioner General Ms Faith Mazani said the authority was taking bold steps to encourage the payment of taxes on time to push the Domestic Revenue Mobilisation initiative.
It is understood that small to medium enterprises (SMEs) presently make up about 70 percent of registered taxpayers and contribute close to 20 percent to tax revenue.
In a speech read on her behalf by the Executive Officer for Corporate and International Affairs, Mr John Chakasikwa, at the ongoing media training on taxation and trade facilitation in Vumba, Ms Mazani said:
“Zimra understands the importance of SMEs and how they impart to the economy.
“We are in the process of reviewing our taxing systems to accommodate SMEs so that they contribute meaningfully to the economy, but also with limited cost on their part.
“Our research is looking at the feasibility of introducing a Turnover Tax, which will be a percentage on the income made by any person engaging in any kind of business.
“They can then pay their tax by mobile phones say end of each week or as at their desired frequency within each month”.
Ms Mazani said the authority was also rolling out tax education countrywide to promote voluntary taxation and compliance.
She said it was important to promote the country’s revenue base to fund Government commitments including social services.
“We would want to see our SMEs growing into large corporates, but with a full understanding of their corporate responsibility.
“We are also asking for the media, which plays a critical role in cultivating a culture of paying taxes and customs duties in Zimbabwe, to partner us in spreading the message of voluntary taxation so that we boost our domestic revenue,” said Ms Mazani.
She said on the business side, voluntary tax compliance reduces unnecessary business costs, which come in the form of penalties and interest levied for late payments or submission of returns, or failure to submit returns or remit payments.
The Zimra boss said the push for voluntary tax compliance was in line with Zimra’s vision of instituting fiscal laws with very limited enforcement being done by the organisation.
Ms Mazani added that the authority had come up with a number of strategies to fight corruption, tax evasion, smuggling, money laundering, transfer pricing and all forms of illicit behaviour, which affects the country’s economic development.
“To fight smuggling, the authority uses scanners, risk profiling and physical examination, post importation audits, border patrols and road blocks in conjunction with the law enforcement agencies.
“In addition, we continue to engage companies which owe taxes, customs and excise duties to agree on payment plans to liquidate their debts.
“It is important to note that Zimra will only use garnishee orders in instances where taxpayers fail to co-operate with the authority in coming up with, and adhering to payment plans,” said the commissioner general. FARMERS in Matabeleland region have been urged to put more land under horticulture as the crops would thrive in the region and are in high demand in foreign markets.
In an interview, Zimbabwe Federation of Farmers’ Union chairman Mr Wonder Chabikwa said farmers in Matabeleland should consider putting more land under horticulture production as the region has favourable conditions for the sector.
“Horticulture was once the country’s third foreign currency earner following tobacco and gold but now it has been pushed to extinction on the list.
“Given the good climatic conditions in Matabeleland, farmers should consider putting more land under horticulture crops and also there is a vast market for these crops overseas,” he said.
At its peak in 1999, the horticulture sector was the country’s third largest foreign currency earner amassing annual revenue of $142 million.
However, at the turn of the millennium, the horticulture sector started shrinking with the country realising earnings as little as $40 million annually.
Last year, the country’s trade promotion body, ZimTrade, identified an export market for horticulture products in Botswana.
The trade and export promotion body said Zimbabwe contributes 0,2 percent to the neighbouring country’s import bill but there was a chance of improvement to push the bill up.
Mr Chabikwa said hybrid crops were the best option for the region because of their immunity to most harmful diseases.
Hybrid crops are plants which are created when plant breeders intentionally cross-pollinate two different varieties of a plant, aiming to produce an offspring, or hybrid, that contains the best traits of each of the parents.
Cross pollination is a natural process that occurs within members of the same plant species.
In the past, Matabeleland region exported paprika, peas and bird’s eye chillies whilst the Midlands farmers exported cut-flowers to the European Union.
Mr Chabikwa said efforts to revive the horticulture sector were being made as ZimTrade engaged senior experts from the Netherlands from an organisation known as PUM to assist horticulture farmers with technical expertise to improve productivity.
Government has since 2016 carried out various initiatives for the horticulture sector including facilitating a learning visit to Fruit Logistica in Germany.
Late last year, Agribank called on horticulture farmers in Matabeleland to apply for loans from the institution so as to boost their production.
The bank has unveiled a $10 million facility to support horticulture farmers across the country. — @queentauruszw .