ZIMBABWE Revenue Authority (Zimra) has surpassed its 2018 revenue target closing the year at US$5,36 billion with excise duty being the highest contributor.
The performance was buoyed in part by the revision of the Intermediated Money Transfer Tax, price effect and improved efficiency and effectiveness by Zimra, as well as enhanced compliance level from taxpayers.
Finance minister Mthuli Ncube revised the Intermediated Money Transfer Tax that was first implemented on January 1 2003 at 5 cents per transaction, to 2 cents per dollar transacted from transactions worth $10, as a way to tax the growing informal sector.
In its 2018 revenue performance report , Zimra said excise duty revenue collections rose 11,48% to US$908,88 million against a target of US$815,31.
Compared to 2017, excise duty revenue grew by 34,47% from US$675,90 million with the main contributors being beer, airtime and fuel, each contributing 9,32%, 12,68% and 71,34%, respectively.
“Excise duty was the highest contributor to total revenue collections in 2018. Performance of the revenue head is attributed to increased supply of petroleum products. The demand for petrol and diesel was heightened by cross-border travellers who preferred to fuel in Zimbabwe due to its flexible exchange rate of Real-Time Gross Settlements. Petrol imports increased by 39,92% from 407,49 million litres in 2017 to 570,17 million litres in 2018 while diesel imports increased by 26,84% from 834,40 million litres in 2017 to 1,06 billion litres in 2018,” Zimra said.
The overall revenue figure for 2018 was 21,80% of gross domestic product, and was 24,71% above the target of US$4,3 billion.
In the fourth quarter of 2018, revenue collections grew by 44,44% compared to the 2017 revenue collections of US$1,08 billion while net revenue collections for 2018 improved by 34,93% from US$3,75 billion collected in 2017.
Gross collections amounted to US$1,66 billion, which was 49,29% above the target of US$1,11 billion and net collections amounted to US$1,56 billion after
deducting refunds of US$106,09 million, surpassing the target by 40,54%.
Zimra said the companies, value-added tax on imports, customs duty and carbon tax performed well above their targets during the period with Intermediate Money Transfer Tax enhancing revenue collections with a total of US$177,27 million.
During the period, most revenue heads registered growth buoyed by the Intermediate Money Transfer Tax growing by 848,30% compared to US$18,69 million
collected in 2017.
However, negative growth was recorded on non-tax revenue compared to collections during the corresponding period in 2017.