ZIMRA adopts voluntary compliance mechanism as tax debt hits $4bn

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By Alois Vinga

ZIMBABWE Revenue Authority (ZIMRA) is in a major paradigm shift which will see the taxman implementing mechanisms aimed at promoting voluntary tax compliance amid indications that the tax debt has swollen to over $4 billion.

In June this year, the taxman revealed that a hefty $4, 3 billion was owed by taxpayers amid fears that the debt may be difficult to recover.

But in a major paradigm shift announced Thursday morning during a telecoms sector breakfast meeting, ZIMRA’s Commissioner-General, Faith Mazani said that the use of rigid investigations and penalty models which were used in the past to enforce compliance will be abandoned in favour of a more friendly interactive voluntary mechanism.

“The reason why we called you here today is that we want to build and improve our relationship with you.

“Our desire is to open channels of communications so that we can contribute to the Zimbabwean renaissance under the mantra – Zimbabwe is Open for Business.

“Indeed as we build and strengthen this relationship our vision as ZIMRA can be summarised into 4Ps – People issues, Processes, Partnerships and Projects,” she said.

The tax authority boss noted that under People issues, sustainable building of ZIMRA staff capacity will be pursued by making them understand the telecommunications sector better by leveraging the human resource base through inculcating within them a culture of service anchored on skill, knowledge and responsible citizenship.

Under the processes cluster the efficiency and effectiveness of the institution’s systems will be pursued in order to bring value to the transacting clients.

Focus will be placed on improving efficiency through automation and ensuring that clients get real value out of the systems.

The processes will be hinged on partnerships which will be used to exchange information and rely on one another for the economic development of the nation.

“ZIMRA is therefore collectively endeavouring to build and sustain linkages and collaborations with all its stakeholders, including the telecommunications sector, to enhance synergies among players in revenue generation and trade facilitation in pursuit of the realisation of economic development goals.

“The Authority is actively engaging with its stakeholders including yourselves, to hear feedback and to act on it. In the process, ZIMRA hopes to improve on its efficiencies and make it easier for valued clients to comply voluntarily,” Mazani said.

On projects implementation and management, ZIMRA has embraced international best practices and principles enshrined in project management tools, as it rolls out and implements anchor projects that will result in the realisation of the vision and mission of the organisation. Under this strategic pillar, tax audits that take time to be finalized will be a thing of the past.

To that end the revenue collector also announced that measures were being put in place in a bid to commence the issuance of tax clearance certificates towards the end of the year in a bid to avoid delays.

“We will be issuing tax clearance certificates much earlier to avoid unnecessary delays,” she noted.

In an interview with Business, the ZIMRA boss said that some companies owing taxes who had approached the tax authority were going to benefit from negotiated deductions.

“While I cannot divulge the exact figures since the deduction exercise is still ongoing, I can confirm that there are companies which approached us in line with government’s initiative to cut down the penalties and fines charged on defaulters. Their issues are still being considered and they will benefit from the exercise, however, the worrying fact is that most of the defaulters did not come forward hence the move to arrange for the extension of the exercise,” Mazani added.