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Oliver Kazunga Senior Business Reporter
THE Zimbabwe Revenue Authority (Zimra) surpassed the $3,82 billion revenue collection target for 2014 despite the prevailing challenging economy with mining royalties and individual tax contributing the biggest chunk. Zimra Commissioner General Gershem Pasi yesterday reported revenue collection for last year was $3,84 billion, recording a marginal one percent increase from the projected target.

He said individual tax gains grew 20 percent and accounted for 26 percent of total collections with mining royalties and other taxes also exceeding their targets by 10 and 12 percent respectively.

Value Added Tax (VAT) on non-local sales and imports contributed 14 percent each.

“Total collections under the individual tax were $911,8 million against a target of $760 million, resulting in a positive variance of 20 percent.

“The revenue authority’s positive performance can be attributed to improved compliance as a result of intensive audits and follow-ups undertaken,” said Pasi.

He said awarding of performance bonuses to workers by some companies also boosted revenue collection.

Pasi said total collections under the mining royalties amounted to $191,67 million against a target of $175 million, which “translates to a positive variance of 10 percent”.

He said payment of arrears from previous years accounted for 23 percent of total collections.

Other notable revenue sources include withholding tax on tenders, domestic dividends, interest, remittances, fees and tobacco levy.

“The cumulative collections amounted to $211,6 million against a target of $189,7 million. Withholding tax on tenders and domestic dividends recorded positive variances of 199 percent and 21 percent respectively,” he said.

“Tobacco levy contributed $9,8 million, missing its target by eight percent whilst capital gains tax and capital gains withholding tax contributed $28,5 million resulting in a negative variance of 10 percent.”

Pasi noted the positive contribution from payment of dividends to company shareholders as well as improved revenue collections from non-residents’ tax on fees and remittances following investigations and audits done during the year.

Liquidity challenges and limited mortgage finance in the financial sector affected the stock market and resulted in depressed performance of capital gains tax.

The statutory body, however, missed its annual revenue targets on corporate income tax, taxes on goods and services, VAT, VAT on local sales, VAT on imports, customs duty, excise duty and carbon tax.

Gross collections under corporate income tax were $373,9 million while net collections amounted to $372,1 million against a target of $442,6 million resulting in a negative variances of 12 percent and 13 percent respectively.

The low revenue from corporates was attributed to the general poor performance of the economy due to various reasons such as liquidity constraints, obsolete equipment, lack of lines of credit, high cost of production and the reduction in industrial capacity utilisation.

Pasi said gross collections for VAT on local sales for the year amounted to $735,8 million and net cumulative collections were $509,4 million against a target of $774,8 million.

Collections from VAT on imports were $480,9 against a target of $486,2 million resulting in a negative variance of one percent.

A total of $512,2 million was collected under excise duty against a target of $569 million.

“Excise duty on fuel and beer contributed 71 percent and 20 percent respectively. The decreased revenue from this sector can be attributed to the volumes of petroleum products that declined in 2014 compared to 2013.

“Petrol imports declined from 472,9 million litres in 2013 to 455,2 million litres in 2014. Diesel imports declined from 935,5 million litres in 2013 to 910,7 million litres in 2014.”

Carbon tax contributed $34,9 million against a target of $40 million translating to a 13 percent negative variance,” said Pasi.