Zimra says to beat FY revenue target, takes aim at informal sector

Zimra says to beat FY revenue target, takes aim at informal sector

HARARE, April 30 (The Source) – Zimbabwe’s tax agency says it is likely to exceed its $4.1 billion revenue target for 2014 through tightening its monitoring systems, cooperation from business and widening the tax collection base to the informal sector.

The government relies almost entirely on tax collections to fund its operations, but has consistently failed to meet targets as the economic base continued to shrink.

But tax agency has in recent times tightened monitoring of individual remuneration and increased corporate audits, which boosted revenue income for the first quarter, enabling it to beat its first quarter target of $818 million by two percent.

“I am optimistic that the 2014 revenue target will be surpassed,” Zimra commissioner general Gershom Pasi said at the launch of the Zimra-to-Business Forum on Wednesday.

“For April, things are looking good,” he added.

Pasi said the agency was working on pilot programmes to capture revenue contributions from the informal sector, targeting mostly micro, small to medium enterprises sector and would even extend to taxi operators.

“We are doing various pilot projects and after that we will be in a position to know how much we need to invest in the programmes,” he said.

The agency, Pasi said, was working with various government institutions to provide infrastructure for the informal sector which would make it easy for the sector to pay tax.

It is estimated that between $3 billion and $7 billion is circulating in the informal sector, which currently does not pay any form of taxes.

“Taxis will be metered, the receipt that one will get after using it will be a fiscal receipt,” Pasi said.

“We will start with five taxis as a pilot then fine tune it before we put it across,” he said.

The Zimra-to-Business Forum aims at fostering cooperation between the revenue agency and various business associations.

The forum is made up of seven economic clusters which are trade facilitation, finance and insurance, industry and commerce, mining and agriculture, SMEs, telecommunications and the academia.

Cooperation with business would make collections easier, allowing the agency to meet future targets, Pasi said.

“We need to meet our targets, not just today, but for as long as there is a nation called Zimbabwe.”