HARARE, (The Source) – Zimbabwe’s state net revenues amounted to $1,7 billion in the half year to June 30, 2,72 percent above target and 9,74 percent higher than the comparable period last year, the tax agency said on Thursday.
Zimbabwe Revenue Authority (ZIMRA) chairperson, Willia Bonyongwe said gross collections for the first half stood at $1,789 billion , 8,05 percent above the target of $1,656 billion.
The bulk of the revenue was realised from individual tax, which contributed 20 percent to total gross collections. The tax band however decreased by 2,35 percent to $347,4 million in the period under review from $355,77 million collected in the comparable period last year.
“Salary cuts, retrenchments and irregular salary payments by some companies continue to affect the performance of this revenue head,” said Bonyongwe.
Excise duty accounted for 17,8 percent of gross collections while net VAT on local sales and VAT on imports contributed 18 percent and 10,5 percent respectively.
The growth in excise duty is attributed to increased import volumes of diesel to 394,56 million litres from 374,18 million litres in the same period last year. However, petrol imports declined by 4,62 percent to 208,74 million litres due to smuggling and under-declaring of volumes imported.
VAT on imports increased by 10,94 percent to $188,6 million from $170 million collected in the same period last year on increased imports of VAT paying goods, in an effort to recapitalize local industry and complement production on the local market, Bonyongwe said.
VAT on local sales grew 13,74 percent to $323,85 million, driven by the introduction of 10 percent VAT withholding tax with effect from April 1.
Mining royalties brought in $34,27 million against a target of $27,9 million attributed to the firming up of metal prices on the global market and increase in production of platinum and gold in the period under analysis.
Corporate tax increased by 47,9 percent to $214,27 million in the first half from $144,87 million recorded in the comparable period last year, attributed to profitability in the financial sector and the use of electronic payments which makes it difficult for companies to invade tax.
Customs duty declined by 3,04 percent from $135,41 million in the first half last year to $139,53 million.
Bonyongwe said tax debt rose 16,85 percent to $3,12 billion from an opening debt of $2,67 billion in January 2017.
“The GDP growth rate was revised to 3,7 percent and hence the projected revenue target is now $3,4 billion for 2017,” said Bonyongwe.
The tax agency said Zimbabwe revenue collection has the potential to reach $6 billion.
“With this level of economic performance and all state-of-the-art cars being driven around Zimbabwe, all construction going on,etc, the revenue collected could easily increase to $6 billion if everyone complies,” she added.