The Zimbabwe Revenue Authority surpassed its half-year revenue target by 8 percent largely driven by improved collections, compliance and strong performance in most revenue heads.
Revenues totalled $1,7 billion, above the $1,4 billion budget, and were 9,4 percent higher year on year, the chairperson of Zimra Mrs Willia Bonyongwe said in a statement. Zimra has come up with measures such as automation, audits and anti-corruption initiatives aimed at enhancing revenues to ease national fiscal strain.
Revenue collections have surpassed targets and this is in the right direction and good progress . . . the measures in place should increase compliance. With the level of economic performance . . . cars being driven around Zimbabwe, all the construction can easily increase to $6 billion if everyone complies,” she said.
The performance in the half year translated to an increase of 9,74 percent compared to $1,550 billion over the same period last year. Revenue collections for 2017 outperformed the 2016 collections except for April 2017, where the revenue target was marginally missed by 6,70 percent.
Zimra said gross collections for the second quarter of 2017 amounted to $926,96 million, which was 9,94 percent above the target of $843,16 million. Net collections for the quarter amounted to $874,64 million after deducting refunds amounting to $52,32 million, surpassing the target by 3,73 percent.
“Therefore, the (Q2:2017) revenue performance was 5,97 percent above the (Q2:2016) collections of $825,34 million. The major performing tax heads were company tax, dividends, fees, interest and remittances (DFIR), customs duty, excise duty and mining royalties,” said Mrs Bonyongwe. Company tax, value added tax on imports, mining royalties, dividends, interest, fees, remittances other indirect taxes surpassed targets for the first half.
Company tax grew by 34,77 percent, net VAT on local sales grew by 3,65 percent, VAT on imports grew by 1,09 percent and DFIR grew by 6,45 percent. Individual Tax collections amounted to $347,41 million, which was 92,57 percent of the targeted $375,29 million during the half year period under review.
Salary cuts, retrenchments and irregular salary payments by some companies continue to affect the performance of this revenue head, which is expected to improve from the Small to Medium Enterprises contributions.
Company tax contributed $214,27 million against a target of $157 million, resulting in a positive variance of 36,48 percent. Revenue collections during the period increased by 47,90 percent from $144,87 million achieved in 2016. The performance was attributed to profitability among banks, other sectors of the economy and electronic payments, which make it difficult to avoid tax.
VAT refunds for the same period amounted to $87,16 million, resulting in net collections of $323,85 million. The net revenue, which represents 98,05 percent of the target, grew by13,74 percent from $284,72 million in 2016.