Ndakaziva Majaka 26 July 2017
HARARE – The Zimbabwe Revenue Authority (Zimra) says it is looking into
the country’s churches with the view of establishing clearer taxing
boundaries, amid indications most pastors are failing to remit all their
dues to the taxman.
Zimra board chairperson Willia Bonyongwe yesterday told the country’s
legislators that while the authority did not tax church offerings and
tithes, other church business ventures were supposed to render to Caesar,
which has not been happening.
The Zimra boss said most pastors had failed to separate their personal
business interests and income from church offerings and tithes, a
situation she said was short-changing the national tax collecting agency.
“… But I think you are right to note that we now have that blurred
situation where the men of God and the church money and their businesses
are one and we are actually looking into that. There has to be a
separation, and declaration of whatever is due to Zimra…
“If you go to America, people like Creflo Dollar and Joyce Meyer have
dealings with the Internal Revenue Services (IRS), so only offerings and
tithes are exempt from tax,” Bonyongwe said at a Zimra parliamentary
workshop in the capital.
Zimbabwe started taxing churches last year. At the moment, receipts and
accruals of church or religious organisations are exempt from Income Tax
as well as donations, tithes, offerings or other contributions by its
Bonyongwe pointed out that in the event that the churches had other
business ventures, these needed to be registered, amid indications Zimra
is also investigating separate businesses being run by churches and their
“As a policy we don’t tax the offerings and tithes but I go to a church
where my pastor pays PAYE (Employees’ Tax)… so they are taxed.
“And if you have a business, and the church is involved in a business it
has to be registered. If it is a trust, it must be registered as a trust.
If it is a normal business it is taxed as a normal business,” said
Presently, churches pay income tax on business profits, which is payable
on business profits, that is income derived from, or deemed to be from a
source within Zimbabwe.
A church may qualify as an employer if it pays any type of remuneration
such as salary, wage, allowance, among others, to its employees. A Capital
Gains Tax is also expected from religious organisations from the sale of
specified assets (immovable property, shares and other securities).
If a church undertakes various trading activities and their annual
turnover exceeds $60 000 per annum, they also qualify to register for Vat,
with church organisations not exempt from the payment of Vat when they
purchase goods or services which are subject to Vat.
There are also a number of Withholding Taxes chargeable to churches in
terms of the Income Tax Act like Non-Residents Tax on Fees, Non-Residents
Tax on Royalties, Non-Residents Tax on Remittances and Withholding amounts
payable under contracts.
Zimra – which surpassed its $1,6 billion revenue target for the first half
of 2017 by 2,72 percent after net collections totalled $1,7 billion – has
been carrying out several revenue enhancing methods which include
lifestyle audits to help Treasury plug its budget deficit which has become
an annual feature.