Zimra sees VAT doubling on automation

The Zimbabwe Revenue Authority (Zimra) expects valued-added tax (VAT) contribution to total revenue doubling to 34% at the end of this month on the back of further automation of the payment system.

The expected increase in revenue contribution by VAT comes as a recent United Nations Capital Development Fund (UNCDF) study showed that digitization of VAT could significantly increase revenues.

Zimra chairperson Willia Bonyongwe yesterday said that the impact of automating or digitizing payments would be most pronounced on VAT.

She said, for example, when the tax management system was implemented it netted many people who were evading tax, all tax heads who would not pay PAYE [pay-as-you-earn] and VAT, among, others showing advantages of digitization of payments.