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Africa Moyo Deputy News Editor
Taxpayers must settle all local currency tax obligations in local currency and must also settle 50 percent of the foreign currency portion of their corporate tax obligations in local currency as the Government measures return stability to foreign exchange markets.
Those who do not have enough local currency to meet their tax bills must approach the Reserve Bank of Zimbabwe via their own banks to sell off enough of their foreign currency, with corporates being warned that if they delve into the black market to raise the local currency they will fall foul of the Financial Intelligence Unit.
For this month’s Quarterly Payment Date, the Government continues to promote the wider use of the Zimbabwe dollar. The intervention follows the general stability in the exchange rate and consequently prices, as a result of various measures announced recently by the Ministry of Finance and Economic Development and the Reserve Bank of Zimbabwe.
The Government says it remains committed to continuing the currency reforms that have enabled the economy to be competitive and will continue to fine-tune the foreign currency markets to achieve lasting price stability.
In a statement yesterday, the Ministry of Finance and Economic Development said its measures had brought “notable stability” in the movement of the exchange rate and general prices of goods and services in the economy.
“In this regard, and to further promote the use of the Zimbabwe dollar in the economy, Government will, for the June 2023 Quarterly Payment Date, require taxpayers to settle 50 percent of the foreign currency portion of their corporate tax obligations in local currency,” reads the statement.
“However, where the law requires the tax liability to be paid in local currency, taxpayers are compelled to settle such tax obligations exclusively in local currency. Government will, therefore, not accept any payments in USD or any other foreign currency for the portion of corporate income tax due in local currency for the June QPD.”
Taxpayers without adequate Zimbabwe dollars to meet their local currency tax obligations would have to approach the RBZ through their banks to facilitate disposal of their US dollar holdings in order to access the requisite Zimbabwe dollars.
Corporates have been “strongly discouraged” from engaging in black-market transactions for settlement of taxes as they will be severely sanctioned by the Financial Intelligence Unit.
The usual statutory penalties for late payment of taxes shall continue to be vigorously applied.
Zimbabwe has been battling foreign exchange volatility, resulting in unrestrained price increases that hit hard the pockets of low income earners.
Employers have also felt the pinch as they were forced to increase employee wages and salaries, and squeezing the little forex available so that their workers remain competitive on the market.
Some of the measures introduced by the Government to stabilise the economy include increasing the retention on domestic foreign sales to 100 percent, as this money just rotates around the economy, adoption of all external loans by Treasury and increasing consumers’ access to basic goods through lifting of import restrictions for some goods.
Online Reporter