Mthuli challenges ZIMRA to target SMEs; ‘sector is a fertile ground for broadening tax base’

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By Xinhua

HARARE: Zimbabwean Finance Minister Mthuli Ncube on Wednesday urged the country’s revenue agency to come up with strategies that compel taxpayers to voluntarily comply.

He said while the Zimbabwe Revenue Authority (ZIMRA)’s performance has been impressive over the past three years, more effort is needed for the organization to boost and maximize revenue collection.

Zimbabwe has registered an increase in unregistered taxpayers following the rapid informatization of the economy over the years.

“While I am generally impressed with ZIMRA’s performance in 2021, I implore you to come up with strategies that will compel taxpayers to voluntarily comply,” Ncube said in a speech read on his behalf at the company’s fifth annual general meeting in Harare.

He said this as ZIMRA’s acting commissioner-general Regina Chinamasa revealed that the debt to revenue ratio increased from 4.76 percent as at Dec. 31, 2020 to 7.17 percent as at Dec.31, 2021, a reflection that taxpayers are struggling to settle tax debts.

Ncube said the revenue agency should tap into the small and medium enterprises sector, noting that “the sector is a fertile ground for broadening the country’s tax base”.

He also underscored the need for the agency to simplify tax processes and ensure its systems are always running.

“Let us make tax compliance a fulfilling and enjoyable exercise. As ZIMRA you have a key role in protecting the civil society and I urge you to remain vigilant and ensure Zimbabwe does not become the transit or final destination of illicit drugs and other smuggled goods,” he said.

Ncube urged the agency to keep fighting corruption and encourage integrity and good governance.

ZIMRA’s revenue grew by 154.77 percent in nominal terms in 2021 from 2020 while revenue grew by 4.73 percent in real terms after adjustment for inflation in 2021 from 2020.

Since 2019, ZIMRA has consistently exceeded revenue targets, despite the challenging economic environment, aided by its five-year strategy running from 2021-2025 that is anchored on digitalization to improve efficiency and revenue growth.

The strategy, according to ZIMRA, focuses on repositioning the revenue agency to play its critical role in the economy through enhanced revenue collection, improvement in ease of doing business and trade facilitation, among others.