via PSMAS top earners were not paying tax | SW Radio Africa by Nomalanga Moyo on Monday, March 17, 2014
High-earning Premier Medical Aid Society (PSMAS) executives have been enjoying tax-free salaries since 2009, the State-run Herald newspaper claims.
The medical aid group is one of several State-linked enterprises at the centre of the raging corruption scandals in which senior executives have been raking in millions in salaries and allowances, at the expense of service delivery.
Last year alone the group’s now-retired chief executive officer Cuthbert Dube was paid $6.4 million, while group operations executive Enock Chitekedza received $2 million and, according to the Heraldreport, this was not taxed.
Millionaire salaries of several other executives at the group were also not taxed, and as a result the Zimbabwe Revenue Authority lost $40 million in potential revenue which it is now trying to recover.
Presidential spokesman George Charamba was paid $100,000 in board fees.
Last week, the revenue authority reportedly garnished PSMAS bank accounts signifying its intention to seize PSMAS funds to settle the tax arrears.
But the garnishee order was cancelled after PSMAS hurriedly paid $2 million and offered the revenue authority “an acceptable payment plan”, the Herald said.
Figures indicate that Dube and his 14-member executive team enjoyed a combined annual salary of $19 million, while ordinary members of the society could not access medical aid because PSMAS was not paying service providers.
At the end of last year the medical aid group owed creditors $38 million, excluding the $40 million which it owes to the taxman.
Since details of corruption and financial mismanagement began to emerge in the press, officials at the group have said efforts are under way to clear the debts and restore the confidence of its more than 800,000 members.
Many Zimbabweans have called on the President Robert Mugabe and his ZANU PF government to take the lead in fighting corruption. So far, despite evidence of fraudulent activities at State-linked institutions, most of the offenders have not been charged. The country’s prosecutor-general has already declared that there will be no prosecutions over ‘Salarygate’ which he said was a moral and not legal issue.
COMMENTS
Saka avasi kusungwa here????
So not paying tax is a moral issue and not against the Law? Better Zimbabweans do not pay tax then. I fail to understand why ZIMRA is garnishing PMAS and not going after the Tax evaders them selves? Do they mean to say the contributors to PMAS are liable for the non payment of these peoples tax’s? Or are they saying these salaries of $500,000 per month included an additional per of the company paying their tax? No wonder ther country is in the drain!
GET THE SCOUNDRELS TO PAY NOW!
Bad governance. Shamelessly defend themselves instead of apologizing, design and go to jail. MADZOSERA ZVAKABIWA (TAX EVASION & OVERPAYMENTS)
How could Cuthbert pay. He is devastated from his treatment in the press. His buddy Gershead Dickbreath at Zimra is in a similar position earning mountains of money and not paying any tax. They have decided as usual to help themselves. The poorest Zimbabweans will pay on their behalf. Now isn’t that what living is all about.
The abuse is breathtaking, and yet people will still rather just sit and watch while these evil people rape and plunder the country and their hard-earned funds!
time to slowly stop paying your taxes – whats good for the goose??
Assume these were after tax packages so their gross would be twice that much! $13million for Cashbert and $4million for Enock. Word has it the ex-FD quit because he felt he was being paid too much!
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ALL VERY LAUGHABLE ,AND VERY ACCEPTABLE.AND ALL ZIMRA DOES IS DRIVE AROUND HASSLING SMALL COMPANIES FOR PAYMENTS ,WHEN THEY HAVE MUCH BIGGER FISH TO FRY WHICH WOULD BENEFIT THEM GREATLY INSTEAD.NOT EVERYONE IS EQUAL IN ZIMBABWE SOME ARE MORE THAN OTHERS.
You are absolutely correct, Blessing! They disgust me!
I am failing to understand the whole issue about tax. Is the $40m going to be paid by PSMAS or it should be paid by the tax evaders. How come ZIMRA garnished PSMAS. I think there is something wrong here. I think ZIMRA should deal with Cuthbert and company not PSMAS. Guys what does the law say regarding this matter?
This is so sad… unfortunately, the company is liable, as it is its responsibility to remit taxes to Zimra. The company could, in return, attempt to get some recompense from the individuals. But ZIMRA has every right to go after PSMAS. A normal company would then fire the finance executives, HR executives and even the chief executive for this liability.
P.S – Anywhere else in the world, people will work thier whole lives to make a million dollars. IN Zim however, you can become a millionaire in 1 year, if you are the head of a non-performing parastal…
Cry Zimbabwe!
Tendai, it is organisations that MUST pay tax directly to the tax office on behalf of employees. It is up to those organisations to prove that they made tax deductions from eomployees’ salaries and forwaded the same to the tax collector. This is NOT rockect science. Such tax MUST be paid through payroll.
This is a simple issue guys. Yes the organisation is liable to pay tax on behalf of it’s employees. In this case we have senior people leading an organisation and acting on behalf of the organisation, these senior people decided not to tax themselves. It is common knowledge even to an ordinary person that all the income received and is abvove threshhold, tax should be applied. This is tax fraud period.
Different contracts have different tax implications. No matter if the companies pays directly to the tax or not (the company is liable for punishment), the earner should also take the responsibility to ensure that the tax is paid, depending on what the salary slip says. If your payslip has a gross of $10 and the same is deposited into your account then it should be your responsibility to ensure that the tax is paid. However if the company claims to have paid tax by depositing into your account the-after-PAYE-deductions amount then the responsibility is the company. It becomes very tricky if you are depositing for yourself the gross and you are the responsible person in the company for the tax payments, it becomes real theft, especially if all other employees on the same type of contract are getting less PAYE deposited into their accounts.
Mr. Tomana, here is the criminal element for you to prosecute. You said you could not prosecute the mega earners because its not illegal to earn a lot of money. Now its criminal not to pay taxes. Set an example for all of them just like what happened to one Uli Hoeness of German who learnt it the hard way that even confessing the ultimate heinous act against the state cannot save you from going to jail.
The country is weak not because of external forces but by the cancer from within.
Inga Zhakata akaimba wani akati “…regai vaite zvavanoda, ndoo nguva yacho, ndoo nguva yacho mama, ndoo nguva yachoo….”.