via Zimra exorbitant taxes, penalties stifling SMEs: Govt – NewsDay Zimbabwe March 14, 2016
SMALL-to-Medium Enterprises minister Sithembiso Nyoni has blamed exorbitant taxes and penalties charged by the Zimbabwe Revenue Authority (Zimra) for stifling growth of the sector.
by XOLISANI NCUBE
Nyoni made the claims yesterday while presenting oral evidence before the Parliamentary Portfolio Committee on Small to Medium Enterprises.
“Zimra may need to review the penalties they levy even in amnesty era. A case in point is of an SME in Gweru, who voluntarily went to Zimra to regularise his position, he was levied penalties of $87 000. That quarter he could not get his tax clearance to facilitate continuity in business,” Nyoni said.
“It is such behaviour that creates a difficult platform to engage SMEs for formalisation,” she said.
After the closure of large enterprises due to the downturn of the country’s economic fortunes, most people have turned to the informal sector to earn a living, but government wants them to formalise their operations for taxing purposes.
Nyoni told the committee chaired by Gokwe MP Dorothy Mhangami (Zanu PF) that most SMEs were reluctant to formalise their operations due to lack of incentives from government as well as a culture of being informal.
“The liquidity crisis has brought with it high cost of money and short-term lending, thereby the SMEs are not prepared to pay other extra costs that are associated with formalisation. SMEs have been informal for too long and they really need a change in mindset. Even when they are able to register, many are ill-disposed to formalise,” she said.
Turning to housing co-operatives, Nyoni said government had not banned them, but the Ministry of Local Government, Public Works and National Housing has stopped allocating land to the co-operatives until such a time when they deal with allegations of fraud and abuse of the societies by some greedy members.
COMMENTS
The only way to stop ZIMRA from fleecing the economy through taxes and levies is when MUGABE learnt to stay in the country doing what he ,must do there by saving funds. each year the minister of finance pronounces an increased budget of which majority of the budget is gobbled by an old man of over 92 years who does not know that there is need to stay home. he moves from one country to another. If there were rockets to take him to the moon or Mars one day Zimbabwe will read news that the president has attended a meeting of the constellation of mars, Jupiter, Pluto and Saturn he will return after a decade.
You cannot tax a country into prosperity! The sooner Zimra work that out and stop victimising compliant companies, the better!
Kabunga you are right, Zimra wastes time inspecting compliant companies just as a time wasting excercise why not go to non compliant, why not visit all these shops that go up almost over night and see if they are compliant.
10 years ago you could ride the road and not see a shop now they are permanent along all roads in Zimbabwe just mushrooming. None have licences, VAT cert or registered in anyway. But all sell Beer, minerals, spirits and other food stuffs. thats where the money is.