OPEN FORUM: Tax defaults: Need for partial or wholesome reprieve

OPEN FORUM: Tax defaults: Need for partial or wholesome reprieve
The Zimbabwe Revenue Authority (ZIMRA) ought to play its part by being sincere to the challenges most companies have been and are still facing.

The Zimbabwe Revenue Authority ought to play its part by being sincere to the challenges most companies have been and are still facing.

By Mutemaringa Kurauone

RECENT media reports on the rising number of tax defaults are a sure testimony of the bad state of our economy.
Addressing this issue is something the authorities should be seized with.
We would be going nowhere as a country in our quest to resuscitate our economy if the issue of company indebtedness to the statutory bodies is not addressed as a matter of urgency.
The honest truth is that companies need tax debt reprieve. Companies have, for a long time, been grappling with operational challenges while business volumes have been on a downward trajectory and it cannot continue this way, hence the need for the relief.
We are in a situation where almost everyone owes someone, while being owed.
It is evident that most companies have for long been struggling with rental, wages and statutory obligations arrears.
A fresh start is indeed needed. Yes, there are those companies that criminally evaded paying taxes, but there are those who have been genuinely incapacitated to honour their statutory obligations.
I understand and value the importance of companies or individuals honouring their tax obligations, but there are situations where clemency has to be considered.
We recently read about a meeting of Vice President Constantino Chiwenga, Reserve Bank of Zimbabwe governor, John Mangudya and captains of industry where it was reported that companies noted the issue of tax debt reprieve as a key issue that would go a long way in rescuing ailing firms.
A holistic approach to establishing the real bottlenecks to the growth of local companies should be undertaken. There has to be a re-alignment of the cost structures of almost everything, that is rentals, wages and raw materials.
Only until this has been looked into would we start noticing some change in our economy.
The Zimbabwe Revenue Authority (ZIMRA) ought to play its part by being sincere to the challenges most companies have been and are still facing.
This is not the time for ZIMRA to start issuing threats.
It should be coming up with measures that give and inspire hope.
Emulate measures that the National Social Security Authority is coming up with.
Penalising and charging interest on someone who has failed to honour the principal amount is, to me, heartless and hopeless.
ZIMRA ought to exercise maximum restraint and be as flexible as possible in working out the payment terms in order to play a role in rebuilding the economy.
Mutemaringa Kurauone is contactable on email kura@zol.co.zw

  • Armstrong Mupfumira

    Well spoken. The issue of penalties on late payments of VAT and PAYE obligations is just devastating. ZIMRA must understand that companies are taking longer to be paid by their clients which makes them fail to meet ZIMRA due dates. It’s just unfair to penalize such a company, instead the Revenue Collectpr should be focusing on bringing new tax payers on board who are evading tax and are not at all in the tax systems of ZIMRA than fleecing those who are making efforts to comply.

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