CUTS Comments on ZRA Briefing

Lusaka, January 8, 2020

Yesterday the ZRA held a press briefing on the performance of ZRA in 2019. Firstly, we wish to commend ZRA for their exceptional performance which saw them exceeding the targeted revenue collection. ZRA collected K52.9 billion thereby surpassing the targeted K51.8 Billion for the fiscal year January 1st to Dec 31st 2019. This was indeed despite the unfavourable economic environment.

It is worth commending, too, the efforts ZRA has directed towards efficiency in service delivery through the advancement in technology. We wish to congratulate ZRA on launching the TaxOnline II as well as TaxOnphone which will all low taxpayers to register for taxes and file returns using their mobile phones. Further to this, noting how lucrative the betting and gaming industry has become as evidenced by the upswing in revenue from K10.9 million in 2018 to K48.9 million, we are happy that ZRA has heightened its compliance enforcement activities in response.

Going forward however, we hope to see more of a dependence on direct taxes rather than indirect taxes as indirect taxes tend to be regressive in nature. In 2019 ZRA recorded a surplus of K264.8 million in indirect taxes and over the past two years, we have noted that the ZRA has collected more revenue from indirect taxes rather than direct taxes and these tend to have more of a negative impact on the poor.

Considering that the mining sector is the backbone of the economy, it is important that the performance of mineral royalty collection be enhanced. Given that the major reason for the poor performance in 2019 was load shedding, we hope that a long-lasting solution to the power crisis comes in to play before the end of 2020 as promised by the government. In the same vein we urge the ZRA to quickly arrive at a solution to addressing the VAT refund issue as it has indeed been a major concern for all stakeholders in recent years.

This year the ZRA’s theme this year is “Maximising Voluntary Compliance for Enhanced Revenue Mobilisation.” To achieve this we urge the ZRA to work towards promoting a progressive tax system and engaging in effective public services and education of the general public around fiscal matters. In the same vein, all government ministries have a role to play as tax payers will increase their compliance if the benefits of paying taxing are evident to all. A high level of tax morale will enforce the social contract between the ZRA and taxpayers and generate increased engagement of individuals with government institutions.

Kindly quote Mr. Aquila Ng’onga and Mr. Ucizi Ngulube, CUTS Research Assistants


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