Sundaymail Editor
IN the 2025 National Budget, Treasury introduced new tax measures aimed at enhancing Government revenues, including expanding the tax base by roping in informal traders, implementing a virtual fiscalisation system and cracking down on smuggling. The Sunday Mail’s DEBRA MATABVU interviewed Zimbabwe Revenue Authority (Zimra) Commissioner-General MS REGINA CHINAMASA, who gave insights into plans to meet revenue targets, challenges of taxing the informal sector and ongoing efforts to combat tax evasion and fraud.
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Q: What are Zimra’s revenue collection targets for 2025. What key strategies are in place to achieve these targets, especially given the current economic environment?
A: Zimbabwe is committed to achieving Vision 2030 of becoming an upper middle-income economy, focusing on sustained progress and economic growth. In 2024, a revenue target of US$6,11 billion was met despite challenges.
For 2025, the goal is US$7,1 billion, to be collected in both local and US dollar currencies under applicable tax laws. The economy is projected to grow by 6 percent in 2025, supported by a favourable agricultural season, increased investments and strong commodity prices, particularly for gold.
Revenue mobilisation will benefit from growth in key sectors such as agriculture, mining, telecommunications, manufacturing and construction, alongside monitoring petroleum mining developments.
Key revenue initiatives include expanding the tax base through new taxes like the fast-foods tax and royalty on coal, targeting the informal sector and enhancing compliance using systems like the Tax and Revenue Management System (TaRMS) and the Fiscalisation Data Management System (FDMS).
Zimra is aiming for 80 percent taxpayer compliance, supported by taxpayer education, staff development, tax kiosks, social media presence and a contact centre. Audit and investigation efforts will ensure revenue recovery and compliance. Zimra’s success in 2024 provides momentum for achieving the ambitious 2025 target, reinforcing confidence in collective efforts for a brighter future.
Q: The 2025 National Budget expanded the tax base to include informal traders, such as fabric/clothing merchants, spare parts dealers, grocery operators and lodges. What approach is Zimra taking to effectively collect taxes from this sector, and how will you ensure compliance without overburdening small businesses?
A: Zimra has segmented taxpayers into large, medium and small categories, with small clients served regionally to ensure nationwide coverage.
Our strategies to improve tax collection include a block management system (BMS) for door-to-door registration, encouraging voluntary disclosures to resolve non-compliance and employing audits or prosecutions in serious cases.
Engagement with industry associations, targeted seminars and public notices will help enhance compliance. Kiosks and taxpayer education through traditional and digital platforms will support those with limited resources.
These initiatives seek to streamline compliance and increase tax collection efficiency.
Q: The Budget also introduced a virtual fiscalisation system for value-added tax (VAT) recording in the informal sector. Has Zimra begun implementing this system? If so, how many informal traders have been integrated into the system so far and what challenges have you encountered?
A: Zimra launched the virtual fiscalisation platform and the Fiscalisation Data Management System in July 2023, offering tailored solutions for micro and small enterprises.
Businesses with existing computer systems, ie enterprises with invoicing, accounting or sales transaction systems, can integrate these directly with the Zimra FDMS using open application programming interfaces (APIs), ensuring compliance with fiscalisation requirements.
Over 3 000 taxpayers have already interfaced successfully with the virtual fiscalisation platform through these APIs. For businesses without computer systems, ie micro and small enterprises lacking such systems, Zimra is finalising mobile point-of-sale applications, set to be launched by March 31, 2025.
These apps will be available for download on the Google Play Store, providing an accessible fiscalisation solution.
Q: There has been a rise in cases of abuse of the motor vehicle rebate. What specific measures is Zimra implementing to curb the abuse and ensure the integrity of the rebate system?
A: Zimra has been actively addressing issues surrounding civil servants’ rebated motor vehicle imports. Since launching an investigation in 2024, no new fraudulent cases have been detected.
To prevent fraud, Zimra has implemented measures such as recovering lost revenues through follow-ups, seizing vehicles involved in fraudulent clearances and imposing penalties.
Vehicles without issues are released after storage charges are paid, while duties and penalties are collected for proven fraud cases.
Strengthened administrative procedures, enhanced supervision, thorough screening and third-party verification are now standard practices before vehicle clearance. Zimra now requires number plates from the Central Vehicle Registry for all imported vehicles, reflecting its commitment to preventing fraud and ensuring regulatory compliance.
Q: The Finance Act, 2023, introduced a wealth tax on houses valued at US$250 000 or more. How much revenue was collected under this tax in 2024?
A: To date, no wealth tax collections have been made. Zimra is currently collaborating with the Ministry of Local Government and Public Works, along with other stakeholders, to develop implementation modalities.
Once these modalities are finalised, the minister will have the authority to create regulations necessary for the effective collection of wealth tax.
Q: The Government has launched an operation targeting cross-border transporters involved in smuggling, aligning with the 2025 Budget’s zero-tolerance stance on smuggling. What role is Zimra playing in this operation, and what impact has it had so far on revenue collection and border security?
A: Zimra’s current operation targets non-compliant importers, not transporters, to combat smuggling. It involves stopping and inspecting vehicular traffic, particularly commercial and passenger transporters, on cross-border trade routes.
These routine enforcement activities have intensified in response to rising smuggling risks, which threaten legitimate trade, economic development and public safety.
The operation aims to regularise imports, ensuring all importers pay duties and taxes while addressing domestic tax liabilities for both formal and informal traders.
It also protects the public from harmful imports, such as hazardous foodstuffs and cosmetics, and safeguards businesses from trade malpractices like counterfeiting and intellectual property violations.
Additionally, it supports legitimate traders facing unfair competition and enhances supply chain and national security.
To date, our State warehouses are at full capacity with recovered goods.
We have seized items with a total duty value of ZiG46 242 385,23 and US$572 199,48.
The ultimate goals are to curb smuggling, promote voluntary compliance and encourage ethical business practices.
Once voluntary compliance improves, controls will remain as part of ongoing risk management to sustain compliance.
Q: What have been the most significant challenges Zimra has faced in revenue collection over the past few years, and how has the authority addressed them to improve efficiency and compliance?
A: Zimra timely replaced the underperforming SAP (TRM) system with the Tax and Revenue Management System on October 1, 2023.
TaRMS was acquired with the assistance of the Government of Zimbabwe and the African Development Bank.
Since its launch, issuing tax clearance certificates has become significantly more efficient.
To assist taxpayers lacking access to computers or reliable internet, Zimra has provided free-use kiosks equipped with computers at all its offices nationwide.
Additionally, a centralised contact centre in Harare now efficiently manages taxpayer inquiries, addressing previous challenges in query handling.
Taxation of the informal sector remains a challenge. In response, the Government revised the presumptive tax law and approved fiscalisation for businesses below the VAT threshold, with virtual fiscalisation solutions for SMEs (small and medium enterprises).
To resolve issues with obsolete fiscal devices used by VAT operators, Zimra now offers options to use physical devices or connect directly to its servers, ensuring seamless compliance.
Q: How is Zimra leveraging digitalisation to enhance tax collection processes, reduce tax evasion and improve overall efficiency?
A: Zimra has introduced various initiatives to enhance tax compliance, operational efficiency and revenue protection.
TaRMS — Empowers taxpayers with better control of their tax affairs, reduces manual errors and promotes compliance through improved record-keeping.
FDMS — Mandates the use of fiscal devices for recording sales transactions, enabling real-time monitoring and preventing revenue leakage.
Automated System for Customs Data (ASYCUDA): Streamlines customs processes, enhances data accuracy and reduces border delays, facilitating trade and boosting revenue collection.
Single window system: Integrates multiple Government agencies into a unified digital platform for customs-related processes, improving transparency, reducing delays and ensuring compliance at ports of entry.
Drone deployment: Enhances border security by detecting smuggling activities and tracking illegal cross-border movements.
Digital and e-commerce taxation: Focused on integrating systems for taxing digital transactions and fiscalising the e-commerce sector to capture revenue from this growing area.
Data analytics and artificial intelligence (AI): Analyses taxpayer data to detect anomalies, identify tax evasion and promote voluntary compliance.
* System integration with government departments: Collaborates with entities like the Companies Registrar’s Office and Civil Registry to curb tax evasion, with plans for further stakeholder integrations to strengthen tax administration.
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