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'No 2021 tax clearance certificates to improperly fiscalised operators'

by Staff reporter
27 Nov 2020 at 17:23hrs | Views
Zimbabwe's tax collector has threatened to withhold 2021 tax clearance certificates to all registered business operators that have not properly fiscalised as most operators are not remitting taxes in foreign currency.
Fiscalised documents encompass invoices, tax invoices, till slips, receipts or other documents recording sales, which are essential to check compliance status of operators trading in foreign currency.
The Zimbabwe Revenue Authority (Zimra) said this is being done in line with more stringent tax compliance measures announced in the 2021 national budget statement.
"Tax audits focused on monitoring of tax payments in foreign currency are currently ongoing. Any detected non-compliance will be sanctioned…" said Zimra commissioner-general Faith Mazani during the Institute Of Chartered Secretaries and Administrators annual conference held in Nyanga Thursday evening.

Mazani said the tax collector will name and shame, prosecute, and issue penalties and interests to non-compliant sectors.
This comes after Zimra gathered that operators were not recording and banking transactions tendered in foreign currency.
Where transactions have been recorded, part or all the foreign currency tendered is not being declared for tax purposes and at most written in manual registers, said Mazani.
She added that operators receive foreign currency payments from customers but issue RTGS receipts.
"Parallel manual invoicing is being used for recording transactions involving foreign currency, and such invoices are not declared for tax purposes. There are stand-alone tills, which are not configured to the ZIMRA fiscalisation system.
"Some traders have created back offices and banking halls where forex payments are being received but not receipted nor declared on returns," Mazani said adding that offline separate systems are being kept for forex transactions.
Such practices are a direct violation of the provisions of section 4A of the Finance Act and section 38 (6) of the VAT Act.
Government gazette Statutory Instrument 185 of 2020 as the Exchange Control (Exclusive Use of Zimbabwe Dollar for Domestic Transactions) (Amendment) Regulations, 2020 (No. 3) following the announcement of a dual pricing system on June 17.
SI 185 was aligned with the provisions of Section 4A of the Finance Act which requires that tax be paid in the currency of transaction.
Mazani said invoices, tax invoices or receipts for business transactions must reflect the correct currency of transaction.

Where sellers issue discounts to their customers in either local or foreign currency, they must issue credit or debit notes to correctly record the changes in the currency of trade, according to the new fiscal regime.
Moreover, sales made in full or part of local and foreign currency, the fiscal document receipts must reflect such currency details.
Zimra is set to roll out a campaign that encourages members of the public to insist on being issued invoices, tax invoices or receipts for payments done reflecting the correct currency of transaction.

Source - finx