Zim acts against illicit financial flows

ZIMBABWE has roped in international taxation institutions to deal with illicit financial flows such as tax avoidance and possible trans-border money laundering cases, which could hinder the country’s economic growth.

Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, revealed this yesterday during the launch of the joint Tax Inspectors Without Borders – Criminal Investigation (TIWB-CI) programme whose aim is to strengthen national institutions in revenue collection.

TIWB-CI is an initiative that enables the sharing of tax audit knowledge and skills with tax administrations in developing countries through a targeted learning and doing approach.

The programme includes the United Nations Development Programme, TIWB and the World Bank, as well as the South African Revenue Service (SARS).

The programme is going to run for 18 months in the country.

Prof Ncube, who was represented by Zimra board member, Mr Paradza Paradza, launched the TIWB-CI programme in Harare yesterday.

“I am advised that this is a unique programme, which the TIWB has only conducted this programme in very few countries across the globe. In Zimbabwe, it is the first of its kind.

“The programme is also unique in that it adopts the learning by doing approach,” said Prof Ncube.

He said Zimbabwe’s tax compliance levels still have gaps and there is a need for robust initiatives and strategies to turn the tables.

“These initiatives ought to be implemented with speed, efficiency and effectiveness for improved results. I am, therefore, pleased that today we are witnessing an initiative whose objective is to increase voluntary compliance through fighting tax and similar financial crimes,” he said.

“This is an initiative, which involves a skills transfer partnership that is being spearheaded by the TIWB. Tax evasion in its various forms is a criminal offense in terms of Zimbabwean Laws.

“It is a predicate offence in terms of the Money Laundering and Proceeds of Crime Act (Chapter 9: 24). One of the impacts of tax evasion as a crime can be demonstrated through a person who acquires property using illegal “savings” from tax evasion,” said the minister.

“This person does not only violate the fiscal statutes but also violates provisions of the Money Laundering and Proceeds of Crime Act.”

He said Property or assets acquired using such proceeds is tainted and should be dealt with in accordance with the provisions of the Money Laundering and Proceeds of Crime Act.

“This is how Government views the seriousness of tax evasion. It is a crime that must be fought and defeated,” said Prof Ncube. The Government is also putting in place measures to deal with impermissible tax planning and tax evasion schemes and help improve the quality of life for ordinary people.

“This is only achievable when we are able to effectively mobilise resources required to finance service delivery. Impermissible tax planning and outright tax evasion schemes are real threats to Government’s ability to mobilise enough resources needed for the attainment of economic and social prosperity for our people,” he said.

“Accordingly, tax administrators are expected to be innovative, agile, client-centric and results oriented. They are required to achieve more with limited resources while at the same time guarantee an efficient and effective service to the tax paying community.”

Prof Ncube said partnerships with international expert entities and other tax jurisdictions such as the SARS will ensure skills and technological transfers.

He said the National Prosecuting Authority, Zimbabwe Republic Police, Judiciary Service Commission, Financial Intelligence Unit and the Zimbabwe Anti-Corruption Commission were central in the fight against the tax crimes value chain and urged them to play their part.

He paid tribute to partners for the programme saying their intervention will go a very long way to improve Zimra’s ability to mobilise revenue for national development.

Meanwhile, Zimra Commissioner General, Ms Regina Chinamasa, said the partnership with TIWB is done to support the national vision and responding to complex financial crimes.

She said the technical expertise will also result in the transfer of investigative skills from the experts to investigators through coaching and guidance.

“This partnership also creates a unique opportunity for Zimbabwe to evaluate the effectiveness and efficiency of our initiatives to fight tax and financial crimes,” said Ms Chinamasa.

“Learning from experiences from our partners and fellow tax authorities also requires that we reflect on our legislative framework for the investigation and subsequent prosecution of tax criminals.” —@nqotshili