Zimra's 1-month tax clearance rule may open door to tender abuse

The Consumer Council of Zimbabwe (CCZ) has raised concerns over the Zimbabwe Revenue Authority's (ZIMRA) recent move to limit the validity of Tax Clearance Certificates (ITF263) to just one month, warning that the measure could be exploited by opportunistic entities if not accompanied by strong procurement governance.

In a statement responding to ZIMRA Public Notice 69 of 2025, which takes effect on December 27, 2025, CCZ Executive Director Rosemary Mpofu acknowledged the tax authority's mandate to enhance compliance and domestic revenue mobilisation. However, she cautioned that the shortened validity period could create operational and financial challenges, particularly for small and medium-sized enterprises (SMEs). Mpofu said while the new measure may strengthen compliance culture and market fairness, it also raises transaction costs and exposes compliant businesses to timing mismatches in filing, payment posting, and system updates. This, she warned, could disrupt procurement processes, strain cashflows, and ultimately increase consumer prices.

CCZ expressed particular concern that some firms might use the short certificate validity to secure tenders and later default. To address these risks, the council called on procuring entities to implement stringent governance measures, including verifying ITF263 certificates at key stages of procurement, incorporating contract clauses allowing suspension or termination if compliance lapses, and using digital verification to prevent reliance on outdated certificates.

The council also questioned whether sufficient stakeholder consultations had taken place prior to the policy change and urged structured engagement between ZIMRA, business associations, SMEs, procurement authorities, tax practitioners, financial institutions, and consumer bodies to mitigate operational risks. Mpofu suggested that consistently compliant, low-risk taxpayers could be granted rolling three- to six-month validity with continuous monitoring, while higher-risk entities remain on monthly validity until compliance improves. She stressed that procurement practices should align with continuous compliance, standardising verification during both contract execution and payment stages.

"CCZ supports lawful measures that strengthen compliance and broaden the revenue base. Nonetheless, reforms must be implemented in ways that do not unintentionally punish compliant businesses, disrupt supply chains, and raise consumer prices," Mpofu said, reiterating the council's readiness to engage stakeholders to ensure that the ITF263 regime achieves its objectives while protecting ease of doing business and consumer welfare.