Source: EDITORIAL COMMENT: Let’s pay our taxes | The Financial Gazette April 21, 2017
A FORTNIGHT ago, government had to beat a hasty retreat after tobacco farmers protested against a 10 percent withholding tax that the taxman wanted to collect from those who did not have tax clearance certificates, effective March 31.
Stung by the tax directive from the Zimbabwe Revenue Authority (ZIMRA), angry tobacco growers threatened to withhold their crop, and government —desperate for foreign currency to starve off a crippling liquidity crisis — could not take the risk.
The reaction by the tobacco farmers was predictable because they had not seen this coming. The response from the powers-that-be was swift as ZIMRA was made to rescind the directive without further delay.
Given a choice, no one really wants to pay any form of tax. However, how then can government fund the country’s infrastructure needs, preservation of natural resources, policing and other social needs if people are not made to pay their taxes?
To that extent, taxes are a necessary evil.
We, however, appreciate that most of our indigenous farmers are still trying to find their feet in the industry. As such, they must be given reasonable time to put their act together before they could register to pay their taxes.
We therefore feel that ZIMRA should do a lot more to educate them on how they should formalise their operations and why it is important for them to pay their taxes.
It is, however, regrettable that most of our people still treat farming as a social activity that keeps them busy without realising that it is a serious business that should be run profitably and in conformity with the country’s laws.
There is also this culture of entitlement that has crept into our people. Regarding our farmers, this culture started when government seized land from the former white commercial farmers without paying any form of compensation. And upon allocating the land to the new occupants, none of them wants to pay anything to the local authorities, the Zimbabwe National Water Authority and ZESA Holdings, including for their inputs.
What is not helping matters is that the majority of these farmers are ZANU-PF politicians, some of who command influential positions in government. As such, decisions that should be made in the national interests are being clouded by selfish and myopic interests like we saw a fortnight ago when ZIMRA was made to go back on its directive.
By knocking on tobacco farmers’ doors, ZIMRA is merely doing its job. The taxman is required by law to collect taxes wherever there is an economic activity taking place, and our farmers, should not be an exception.
We are not in any way suggesting that there is optimum usage of taxes in Zimbabwe. Far from it!
By going back on its word, ZIMRA’s reputation has been damaged severely because it is now clear that the taxman is capable of bending the rules when put under pressure.
We therefore do not see how the authority can succeed in extending the tax net to cover the informal sector with crucial elections just around the corner.
COMMENTS
10% on tobacco (or any crop) is massive especially told at the last minute! Because they selling doesn’t mean there’s huge profit. Most of it goes back to the tobacco finance companies. There does need to be an education setting up farmers properly and explaining how accounts and the tax system work. There also needs to be reasonable interest rates charged. Banks need to give finance. Compensation needs to be paid so that land can be properly leased out that a bank can use as collateral. It’s enough of the confusion and chaos!
Zimra bully and thug anyone they see may be earning a dollar in this economy. Like parasites, they feed off the little bit of positive in one until they eventually kill them.
You need a working economy with employment in order to pay taxes. So simple!