Zimra surpasses fourth quarter target

19 Jan, 2018 - 00:01 0 Views
Zimra surpasses fourth quarter target Zimra

The Herald

Business Reporter
The Zimbabwe Revenue Authority (Zimra) has surpassed its 2017 fourth quarter revenue target by 28,12 percent to $1,159 billion from $880,43 million due to high collection in Value Added Tax, data from the authority shows.

Net collections surpassed the target by 22,78 percent above target.The year 2017 has seen consistent in positive performance for most revenue heads, except Individual Tax, Carbon Tax and Dividend, Fees, Interest and Remittances (DFIR).

The concerted implementation of revenue enhancement measures by the authority enabled steady inflows and reduced revenue leakages despite the negative factors in the operating environment.The performance shows progressive increase in revenue inflows over the four quarters.

This is expected to pick up pace and be more defined in 2018 as extra efficiency measures are expected to be applied.The overall 2017 annual performance, however, remained way above the 2016 collections.While presenting her 2017 revenue performance report, Zimra Board chairperson Mrs Willia Bonyongwe, said the revenue collection enhancement measures such as systems automation, audits and anti-corruption initiatives were critical to surpassing quarterly revenue targets.

“Gross collections for the fourth quarter 2017 amounted to $1,159 billion. Net collections stood at $1,081 billion after deducting refunds amounting to $78,06 million. The target for the quarter was $880,43 million.

“Net collections surpassed the target by 22,78 percent. The 2017 fourth quarter revenue performance was 28,12 percent above the $843,74 million collected during the same period in 2016.

“The major performing tax heads were Company Tax, Tax on Dividends, Fees, Interest and Remittances, CGT and CGT Withholding Tax, VAT on Local Sales, Mining Royalties and Other Indirect Taxes,” said Bonyongwe.

Zimra’s gross annual collections amounted to $3,978 billion, while net collections after deducting refunds of $228,28 million amounted to $3,750 billion against a target of $3,4billion.

This gives a positive variance of 10,29 percent .Net revenue collections for the year 2017 improved by 15,46 percent from the $3,248 billion collected in the year 2016.Revenue performance in the past 12 months of 2017 was higher than the same period in 2016, except for April and June.

The Zimra board believes that current collections are still a tip of the iceberg and is determined to stir up management to re-double the current measures to ensure increased compliance.

As Government is exploring options to broaden the tax base, the SMEs and Co-operatives Development Ministry has requested a resource envelope of $30 million from Treasury to formalise unregistered and non-compliant small businesses and encourage them to enter into direct synergies with the manufacturers across the country.

The concerted effort by the authority through rigorous revenue enhancement measures, an unwavering stance against corruption and resultant improved compliance by taxpayers, contributed to this positive revenue performance.

Company Tax, VAT on Local Sales, VAT on Imports, Customs Duty, Excise Duty, Mining Royalties, Withholding Tax on Contracts and Other Indirect Taxes surpassed their set targets for the year 2017.

The performance of Individual Tax, which was consistently affected by negative factors in the operating environment characterised by downsizing and retrenchments, fell short of its 2017 target by 35,78 percent.

Other revenue heads such as Carbon Tax and DFIRs also did not meet their set targets.Revenue collections from Company Tax amounted to $730,50 million against a target of $337,20 million to give a positive variance of 116,64 percent.Revenue collections during 2017 increased by 114,40 percent from the $340, 72 million collected in 2016.Corporate Income Tax debt was $1,462 billion compared to $751,49 million in 2016.

The positive performance can be attributed to improved profitability by some companies especially in the financial services sector.Increased use of electronic transactions also enhanced inflows, with the added advantage of traceable transactions for audit purposes.Gross VAT on local sales collections for the year 2017 increased by 37,1 percent to $913,41 million against a target of $666,24 million.

VAT refunds for the year 2017 amounted to $226,33 million, which translates to net collections of $687,08 million.Net revenue collections surpassed the target by 3,13percent and revenue grew by 14,28 percent from the $601,22 million collected in 2016.Revenue collections under mining royalty revenue had surged by 6,3 percent amounting to $73,11 million against a target of $68,77 million.

The future performance of the revenue head is influenced by the movement in global prices of minerals; production levels of key minerals such as gold, platinum and diamonds; and level of sales of mineral products. Currently, these prices continue to fluctuate.

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