Tax compliance costs weigh on business

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BUSINESS says it has had to contend with the growing costs of complying with Zimbabwe’s constantly changing tax laws.
Speaking at The Financial Gazette’s annual tax indaba in Harare last week, Old Mutual Zimbabwe group finance manager, Lucia Chipungu, said the recent adjustment of Value Added Tax (Vat) to 15 percent from 14,5 percent, for example, had dented local businesses’ profitability.

“We were only given a night or two to prepare business for the transition, but it wasn’t just as simple as changing a number… we had physical gadgets to look at… we had to engage the vendors of the machines and negotiate the prices and this cost was not budgeted for,” Chipungu said.
“The impact was felt on our input costs as business, everything just went up. There were also additional costs for businesses with importing licences and those that have royalties… all this is biting into the little revenue we are making.”