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Close to K2 billion has not been remitted to the Zambia Revenue Authority (ZRA) by withholding agents appointed by the authority to deal Value Added Tax (VAT) from suppliers during the first half of this year.
ZRA Commissioner General, Dingani Banda, said this money had been withheld from suppliers by the appointed agents but not remitted to ZRA.
Banda, in his presentation at a Mid-Year Economic Performance and 2024-2026 Medium Term Budget Plan meeting in Lusaka on Tuesday, complained that the exercise initially started on a positive note but that over the years, ZRA had seen high levels on non-compliance.
“The over 105 withholding agents would withhold the VAT from their suppliers but not remit it to ZRA, as a result we have had a number of instances where huge amounts of money outstanding at the end of the period not remitted to ZRA but withheld from the suppliers.
“So as at the end period under review we had almost K2 billion that we withheld but not remitted to ZRA. As at end December 2022, we had about K11 billion that was withheld but not remitted to ZRA,” he said.
Read more: ZRA targets Artisanal, Small-Scale Miners for voluntary tax compliance
Meanwhile, Banda revealed that only seven out of more than 2,400 mines on its tax register were tax compliant.
He said 80 percent of the revenue from the mining industry sector in the first half of this year only came from seven mines.
ZRA gross collections for the first half of this year were K56.1 billion and refunds amounted to K8.1 billion, resulting in a net collection of K48 billion.
The net collection was K4.0 billion or 7.7 percent below the period target of K52.0 billion
“Let me focus on the controversial topic, the mining sector. You can see that the 34 percent that the mining sector contributed, 80 percent of that only came from seven mines.
“We have over 2, 400 mines on our tax register but 80 percent of that only came from seven area we need to focus on more in terms of driving compliance,” Banda said.
He said tax compliance had remained a challenge for ZRA.
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