Zimra targets informal sector

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ACTING Zimbabwe Revenue Authority (Zimra) Commissioner-General Rameck Masaire (pictured inset), says the tax collector’s focus next year will be to expand its revenue base by targeting the informal sector.
In an interview on the sidelines of an event to mark Zimra’s 20th anniversary held in the capital recently, Masaire told The Financial Gazette that there are more players in the informal sector, and there is scope to increase revenue collection in that space.

“The informal sector employs more people in the country and there is a lot of activity in that sector. Going forward, we would want to increase our focus in that space and improve revenue collections.”

For the full year ended December 31, 2020, Zimra managed to collect annual net revenue of $181,96 billion against a target of $171,9 billion. This included US$790,7 million in foreign currency. Last year, Zimra continued with its drive to broaden the tax base through new registrations. Active taxpayer education and engagement programmes resulted in about 21 600 new registrants, who contributed $558 million.

“We undertook a deliberate drive to widen the tax base through registration of new taxpayers, which resulted in an additional 21 600 new taxpayers last year. These new taxpayers contributed $558 million against a target of $218 million.

“This is a model that can be replicated in the informal sector to increase revenue collections next year,” he added.
Masaire said Zimra also enhanced the project on integration of databases between government agencies to facilitate registration in sync with the government`s thrust of widening the tax-base.

Speaking at the same event, Finance minister Mthuli Ncube said Zimra should make the broadening of the tax base a top priority.
“Let me also challenge Zimra to come up with innovative ways that will compel citizens to voluntarily fulfill their tax obligations. Citizens should have confidence that their cent is going to be used for their direct or indirect benefit.

“Zimra should take up the issue of tax education and ensure it is introduced at an early age to inculcate ideals of responsibility and tax morale among school children towards the development of the country.” Ncube also challenged Zimra to continue plugging revenue leakages, which he said were a result of tax evasion, tax avoidance, smuggling and under-declaration of imports.

Since 2001, Ncube said Zimra has helped the country stand on its feet by providing over 90 percent of the country’s budgetary resources annually.
“To demonstrate this, since 2001, the government has been setting a target for Zimra to collect average revenue of US$1,84 billion every year and in response over US$1,99 billion was collected every year thus, surpassing the set revenue targets,” he added.

Zimra has facilitated exports worth US$58,2 billion and imports worth US$86 billion since the year 2003.
“I am informed that Zimra only missed the revenue target by a whisker in 2001, 2009, 2014 and 2016 and this has been as a result of different internal shocks that the authority has had to grapple with over the said years.
“But, cumulatively Zimra managed to contribute a total of US$39,8 billion to the state from 2001 to 2020,” Ncube further said.
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