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Bulawayo Bureau
ZIMBABWE Revenue Authority (ZIMRA) has mandated all local authorities to stop issuing or renewing trade and business licences to people who do not have valid tax clearance certificates. According to a letter issued by Mrs Roseline Ntuli Regional Manager, local authorities are no longer allowed to renew or issue licences to business people in their areas unless the operator, miner or any other business person produces to the licensing authority a valid tax clearance.A Tax Clearance Certificate is confirmation from revenue that an applicant’s tax affairs are in order at the date of issue of the certificate. In some instances a certificate may be issued to a customer who has tax arrears provided such arrears are covered by an instalment arrangement that has been agreed with Revenue.
“You are kindly reminded that terms of section 80A of Income Tax Act (chapter23:06) you are required not to issue or renew trade/business for persons without valid tax clearance certificates,” stated the letter.
Local authorities are against this initiative and they claim that it is going to negatively affect them as well as their service delivery. Umzingwane Rural District Council (RDC) chief executive officer Mr Ndumiso Mpofu said they have been issuing and renewing licences for business people in their district without any clearance from ZIMRA.
“We are surprised why all of a sudden ZIMRA decides to change things, which is a an inconvenience to everyone involved considering the fact that the business people are not aware and it will take time for them to be in contact with the ZIMRA people,” he said.
Mr Mpofu said this initiative is going to interrupt service delivery since the money that was the money that used to kick start project especially in January when there is cash shortage.
“ZIMRA should decentralise and establish their offices in district level so that business people can access their licenses whenever they want. What they don’t realise that they are enhancing illegal trading among business people,” he said.
Mr Mpofu said: “ZIMRA should no restrict or obstruct but should facilitate business.”
Insiza Rural District Council (RDC) chief executive officer Mr Fidres Manombe said they also receive the same letter from ZIMRA and they were against it and it is going to negatively affect them.
“We are already experiencing cash crisis after the government in 2015 took over the collection of land from local authorities and now ZIMRA is adding to the problem. As of now we are failing to pay salaries and we thought that we will get money from the licences,” he said.
Mr Manombe said: “With January fast approaching we were hoping that we will get revenue there, as for the people who have businesses in rural areas I think it is kind of impossible for them to obtain a clearance form which is further leading to illegal dealings amongst business people.”
Our Bulawayo Bureau also spoke to the Council Chairman of Mangwe District Mr Mafesi Ncube who could neither confirm nor deny receiving the letter. “If indeed ZIMRA is going to implement that it means the government is trying to close local authorities because there is no other way of getting income. As councils we are supposed to get 5 percent from the government but we are getting nothing,” he said. “Unit tax was taken away from them and now ZIMRA is doing the same which means that the lacal authorities are going to close.”
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