Tendai Kamhungira 
THE government is set to crackdown on businesses charging goods in United States dollars and remitting their taxes using the local currency, Finance minister Mthuli Ncube told Parliament recently.
Faith Mazanhi, Zimra’s commissioner general
This comes as the Zimbabwe Revenue Authority (Zimra)’s tax revenue figures took an 18 percent dip in the first seven months of the year due to the impact of the global Covid-19 pandemic.
“When the customer pays in the currency of their choice and the retailer accepts, they ought to remit the tax that applies to that transaction in the currency of trade. So, if the customer has paid in US$, the retailer must remit the tax in US$ as well. If they are not … they are breaking the law and we will enforce the law and catch them.
“I will instruct Zimra to go around doing the relevant inspections to make sure that those who are breaking the law are brought to book. We must enforce that, otherwise we are losing revenue because they are playing around with the exchange rate when they are keeping the forex, depriving us of foreign currency. We will make sure that we deal with them,” Ncube said.
A number of retailers are selling in US$ but producing receipts denominated in the local currency, while some are using a higher exchange rate than the official auction rate in a bid to lure customers to pay in hard currency.
Zimra commissioner-general, Faith Mazani, told a recent virtual meeting of businesses that the practice was rampant.
“Just as a consumer myself, I have experienced situations where … you go into a shop and you are asked what currency are you paying through, you are told if you are swiping you are given a (different) price, if you are paying in US$, you are given a (different) price and when you then ask what exchange rate are you using, they say we are using the auction rate, but we are giving a discount for US$ payments,”she said, without giving figures of how much could have been lost in taxes through these acts.
“I think this is actually fraud because we are just using a different exchange rate and we are aware of this and we would like for the business community to please continue talking about this so that we actually comply and the unfortunate thing is we still have people that are issuing receipts. I personally, have gone to a shop and I was told if you want a US$ go to the office and see the manager, it’s unfortunate.”
However, according to the Confederation of Zimbabwe Industries (CZI) the tax legislation needs to be framed clearly to allow for full compliance by taxpayers.
“There are inconsistencies between the tax legislation and the monetary policies and the pronounced government policies relating to legal tender and a monocurrency roadmap. Of particular concern is the requirement for each taxpayer to be assessed separately for forex and ZWL transactions when the taxpayer is organised as a single business entity.
“Taxpayers must have a choice as to the currency used in settling tax obligations… Government needs to be seen to act in furtherance and support the policy of a local currency,” the CZI said in submissions to the Treasury.
