VAT dominates Zim revenues

Zimbabwe's revenue inflows are now being dominated by the value added tax (VAT) which contributed 60 percent of gross collections for the first half of this year.

The first half of this year has resulted in the revenue collector ZIMRA registering an 8 percent rise in gross collections to $1.8 billion against  a target of $1.65 billion.

However, in terms of overall contributions, VAT has accounted for more than $500 million against a target of $170 million.

Tax experts have attributed the dominance of VAT to an effective tax compliance monitoring system and improved availability of locally manufactured goods.

Individual taxes accounted for $347 million in the first half with expectations of a rise in revenues from the small to medium enterprises industry.

Revenue collections from the excise duty was pegged at $319 million against a target of $330 million.

Gross collections for the custom duties, however, dropped to $139 million against a target of $141 million.

The recovery within the mining sector global prices has also resulted in tax contributions in the form of royalties increasing by 22,84 percent to $34,27 million against a target of $27,90 million.

In a related development, 12 992 SMEs have also registered for VAT after the expiry of a deadline for the industry to comply on June 30 this year.