Army owes Masvingo council US$5million

via Army owes Masvingo council US$5million – NewZimbabwe 20 April 2015

THE financially crippled Masvingo city council has proposed to have the $5 million debt the local authority is owed by the Zimbabwe National Army used to pay off its tax arrears with Zimbabwe Revenue Authority (Zimra).

The army has resisted efforts by the local authority to cut-off water supplies in a bid to force payment of the debt. The city has also struggled to find debt collectors willing to take on the army.

Council has a statutory obligation to remit tax to Zimra which the local authority has not been paying for several years due to cash inflow.

Town Clerk Adolf Gusha confirmed the debt swap plans and said negotiations with the Finance ministry, ZIMRA and council to have the debts swapped are underway.

“Negotiations are ongoing between the parties to have the debt swapped; it’s not a new phenomenon we have been doing it with various organizations whom we owe while they owe us.

“It’s difficult to say much at the moment as negotiations are underway,” he said.

Council sources said efforts to cut water supplies for non-payment of service charges to the two army barracks located in Masvingo have been met with resistance from army officials, while no debt collector was willing to take on the army.

Officials added that since the government forced local authorities to scrap residents’ debts towards the 2013 elections, residents have developed a tendency of not paying bills.

“Council is literary broke; people are not paying their bills like they used to prior to their debt cancellation and, since then council, has failed to generate enough revenue,” said an official.

According to the recent full council meeting, the city managed to raise $287 256.50 against a total billing of $391 125.87 for high density residential areas for the month of February alone.

Residents, government departments and other institutions owe council in excess of $30m since the beginning of the year.