THE Zambia Revenue Authority (ZRA) has amended Rule 18 of the Value Added Tax (VAT) General Rules of 1997 to safeguard Government revenue with effect from September 8, 2014.
Meanwhile, ZRA withheld about K3 billion on account of tax-payers who declared zero-rated sales on exports but have not provided documents to the Authority as at July 31, 2014.
ZRA commissioner general Berlin Msiska said Rule 18 affects exporters and the mining sector.
This is according to a statement issued in Lusaka yesterday by ZRA corporate and communications manager Mumbuna Kufekisa.
Mr Msiska said Rule 18 ensures that VAT fairness in international trade is achieved by not subjecting exporters to VAT zero-rating while at the same time providing tax refunds of input taxes.
Mr Msiska said importers will also be taxed on the same basis and at the same rates as domestic suppliers.
“ZRA is considerate of stakeholder concerns in the administration of taxes.
“Rule 18 of the principal Rules is amended by the deletion of sub-rule (1) and the substitution thereof of the following: ‘Unless the commissioner general shall otherwise allow, a taxable supplier claiming that a supply is zero-rated under the second schedule to the Act on the grounds that the supply is an exportation of goods, shall produce to an authorised officer’,” he said.
Mr Msiska said a taxable supplier shall be required to provide copies of export documents for the goods, bearing a certificate of shipment provided by ZRA and tax invoices for the goods exported.
He said proof of receipt of payment for the goods and other documents will be required.
Mr Msiska also said that ZRA has paid out K762,747,465.47 in respect of tax-payers inclusive of the mining sector who have since provided the required documents.
He said refunds withheld on account of non-compliance with the existing Rule 18 can only be made when the legal documentation has been provided to ZRA.
Mr Msiska, however, advised tax-payers to adjust their supplies from zero-rated to standard-rated and apply 16 percent VAT rate.
“Consequently, non-compliance with the VAT rules on exports means that exporters are obliged to charge VAT at 16 percent on the supplies but will still be entitled to claim input VAT,” Mr Msiska said.
Laughable like LTs writing skills
Mere waffling and insertion of a get-out-of-jail clause: ZRA will still have to refund VAT for exporters like it used to until PF came in with their amateur rules. The “legal” export documents are all local. This is a real climbdown by ignorant people.
I would like you to shade more light on the people lending others money with interest.
In my own view anyone making profit out of something must pay tax to the government.
There are a lot people especially Lunshya who deals in Kaloba. Do they get Certificates from the Government or papers ? The interest is also too much 50% and above. Kindly shade more light on this matter.
Can a tax accountant break this down in to common lannguage. What are the implications?
ZRA, update your web with this info
We have no tax accountants in Zambia. Maybe we ask one from the neitherlands. hehehehehe
To be frank, coming from the STEM background, I have no idea what this tax refund is all about and I have never read anything that succinctly explains what it is. The more I read articles on this refund thing, the more I get confused. The economists/tax experts have not really helped a common man to understand what this is all about. Questions like what is VAT refund, why is it refunded in the first place, why has it accumulated to over $600m, why the outcry from M’membe and other “stakeholders”, what has been the practice in the past.. etc need to be answered
VAT is tax to consumers on products except books and baby food.
So when a company is selling its products have to add 16% to the charged price as the final price of their product,and when its also buying other product which qualify for VAT,its has to find the difference between the input tax(sales) and the output tax(purchases),The surplus it gives the government and deficiet it claims from the government.Now since the mines sales their product oversees,its not easy to know how much tax input they charge because they may be under pricing just to invade tax,they were asked to produce certificate to proof the price they are selling their products so that gorvernment can know how much tax input or VAT is,Now Chikwanda(corrupt) is against it,that its difficult to find documents.
my company has a TPIN number,now how to get a V.A.T number