Treasury surpasses Q1 tax revenue target

Zimbabwe has exceeded its tax revenue collection target for the first quarter of 2025, with the Zimbabwe Revenue Authority (ZIMRA) collecting US$1.5 billion, marking a significant milestone in the government's economic reform agenda under the National Development Strategy 1 (NDS1).

Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube reported the positive performance to Cabinet recently, highlighting that both tax and non-tax revenue collections surpassed the set targets for the January to March period. The figures indicate that the country is on track to meet its ambitious annual revenue goals.

"In terms of the Economic Growth Pillar of the National Development Strategy 1, the Minister of Finance, Economic Development and Investment Promotion highlighted that the mobilisation of tax revenue and non-tax revenue has surpassed the first quarter target," said Information, Publicity and Broadcasting Services Minister Dr Jenfan Muswere during a post-Cabinet media briefing.

According to the 2025 National Budget projections, total revenue collections are targeted at ZiG$270.3 billion, or approximately US$7.5 billion, while government expenditure is estimated at ZiG$276.4 billion.

To enhance domestic resource mobilisation and broaden the tax base, Minister Ncube introduced several fiscal measures in the 2025 budget. These include the review of Special Economic Zone (SEZ) tax regimes, a 10 percent withholding tax on gross winnings from sports betting, a 0.5 percent tax on the sales value of fast food, and the reintroduction of customs duty on select medical products.

ZIMRA Commissioner General Regina Chinamasa confirmed the first-quarter performance, stating that the authority had collected US$1.506 billion, slightly above the target of US$1.502 billion. This figure translates to ZiG$40.32 billion and places the revenue authority on course to achieve its full-year target of US$7.15 billion (ZiG$220 billion).

"We are pleased with the performance so far, and we believe we are on track to meet and possibly exceed our annual target," said Chinamasa in a recent interview with the Zimbabwe Broadcasting Corporation (ZBC).

ZIMRA, which is tasked with assessing and collecting revenue for the government, continues to modernise its operations under the Economic Growth and Stability Pillar of NDS1. The Tax and Revenue Management System (TaRMS), a key part of these reforms, is being implemented in three phases and has already achieved notable progress.

Minister Muswere noted that the first two phases-comprising core frontend processes and the Tax Agent Module-have been successfully completed. The third phase, which includes backend processes, has also seen significant advancement, although integration with the Risk Compliance Management Module remains in progress.

On fiscalisation, internal integration with three banks is underway, alongside external integration efforts involving five government departments. Muswere added that user acceptance testing for the Risk Compliance Management Module Phase 1 has been finalised, while Phase 2 is ongoing. Additionally, the Business Intelligence Reporting project is advancing well, and the launch of the Single Account Automatic Re-opening is in progress.

Zimbabwe's revenue collection performance signals increased fiscal discipline and improved compliance, offering optimism for economic stability amid ongoing structural reforms.