Mobile money transfer tax rakes in $2.1 billion inside four months

Spread This News

By Alois Vinga

GOVERNMENT has managed to rake in a total $2.1 billion through its 2% intermediated mobile money transfer tax (IMTT) which has now become a major revenue contributor.

The Zimbabwe Revenue Authority (ZIMRA) performance report for the second quarter ended June 2020 with $2.1 billion collected against a target of $1.7 billion.

The revenue head registered a 450 % increase when compared to a similar period last year.

During the period under review, individuals injected $3.4 million against a target of $1.7 million.

“ZIMRA continued with the compliance improvement strategies on the telecom sector and mobile money platforms to ensure improved collections; this had a positive impact on collections.

“The tax head performed above target as the use of data increased during the quarter with businesses setting up home work stations during the lockdown,” the report said.

According to the report, net revenue collections for the period amounted to $20.11 billion against a target of $14.09 billion.

Net revenue collections grew by 542.24% in nominal terms while all revenue heads registered positive growth in nominal terms but in real terms, there was no growth.

“All revenue heads performed above 2019 levels in nominal terms because of the hyper-inflationary environment that the country is experiencing,” the report said.

Major contributors to revenue were companies 21%, Individuals 17%, Excise Duties 15 % while and Value Added Tax on Local Sales amounted to 10%.

Revenue collections maintained a positive trajectory in nominal terms despite the adverse operating environment that has been exacerbated by the Covid-19 pandemic.

The second quarter of 2020 was characterised by a widening gap between official and parallel market exchange rates and rising inflation.