The Zimbabwean government has widened its tax bracket to include Value Added Tax (VAT) on nearly 40 imported basic food commodities as the country's revenue performance continues to disappoint.
With revenue for the year ended 31 December 2015 coming in 3% lower than prior, the Zimbabwean authorities are looking for all avenues that can boost revenue collection in 2016.
In a Government Gazette of January 22, Finance Minister Patrick Chinamasa amended Section 78 of the VAT Act by repealing clauses that until now allowed the imported food commodities to be taxed at zero rate. The tax is effective from February 1.
The drastic moves come at a time the Zimbabwe Revenue Authority (Zimra) said revenue collected for 2015 was 3% lower at $3.5bn.
In its Revenue Performance Report for the year ended 31 December 2015, released on Thursday, Zimra said the revenue collected "reflects the subdued state of the economy".
In 2016, Zimra, said it was going to vigorously enforce all current fiscal legislation to increase level of compliance.
Zimra is also working on introducing cargo tracking in 2016 to cut down on smuggling.
Zimra however said the major challenges facing Zimbabwe's economy remained unresolved.
"These are the erratic supply and high cost of energy, the high cost of capital and unavailability of adequate capital, and the use of the relatively strong dollar, among other factors.
"These economic variables negatively affected profitability of companies and clients' ability to pay debts, resulting in generally low trends of revenue collection," said Zimra.
Source: http://www.fin24.com/Economy/zim-to-tax-imported-food-commodities-20160204
Comments (0)
Comments are closed