9.5 C
Alba Iulia
Friday, August 7, 2020

Zambia Association of Manufacturers over new ZRA proposal to implement a Digital Tax Stamp Solution

Headlines Zambia Association of Manufacturers over new ZRA proposal to implement a...

ZRA SUPPORTS PRESIDENT LUNGU’S INITIATIVE TO EMPOWER CLEARING AGENTS OWNED BY ZAMBIANS
ZRA SUPPORTS PRESIDENT LUNGU’S INITIATIVE TO EMPOWER CLEARING AGENTS OWNED BY ZAMBIANS

The Zambia Association of Manufacturers has raised concerns with regards to the implementation of the proposed solution Digital Tax Stamp Solution to enhance tax compliance on all excisable products.

The Zambia Revenue Authority has announced its intention to start implementing a Digital Tax Stamp Solution to enhance tax compliance on all excisable products, thereby joining countries such as Uganda and Mozambique in pursuing this option to curb illicit trade and enhance revenue collection.

Whereas the Zambia Association of Manufacturers remains supportive of measures to enhance tax revenue collection and revenue assurance by the ZRA, the Association says it is worth noting that the DTS solution is most effective where smuggling, counterfeit products, tax leakages and under declaration of production or sales volume is rife by registered industry players.

ZAM Vice President South Chipego Zulu says for this reason, it is imperative to note that it may not be ideal to treat all companies producing excisable products the same in view of variability in tax compliance and the nature of illicit trade in their respective sectors.

Ms Zulu says the Authority should channel resources towards promoting Voluntary Compliance, instituting cheaper effective enforcement controls and targeting specific sectors within the economy, where there is proven evidence that smuggling, counterfeit products, tax leakages and under-declaration of operational volumes exist.

She said viewing the Digital Tax Stamp Solution solely as a tax revenue growth initiative therefore is erroneous, as a poorly designed solution would likely result in increased costs of doing business/production for legitimate manufacturers in excisable sectors.

Ms Zulu said higher costs will in the medium to long-term translate into reduced revenue collection for ZRA as a result of products in these sectors becoming uncompetitive on the market.

She has since recommended that a comprehensive consultative process be undertaken with the affected private sector companies to determine the manner in which the DTS solution will be implemented and ensure that adequate sector specific input is gathered and considered in the design and execution of the same.

Ms Zulu said it is imperative that the ZRA undertake an independent due diligence assessment of the DTS solution in those countries in which it has been implemented such as Mozambique, South Africa, Kenya, Tanzania, Uganda and Ghana who are in the process of implementing similar solutions, albeit amidst high operational and cost challenges to both the Revenue Authorities and Industry.

Further, Ms Zulu has observed that the reported Track and Trace system that forms the crux of the proposed DTS solution does not currently exist anywhere in the rest of Africa and it is therefore imperative that international best practices and more cost-effective alternatives be considered before the ZRA proceeds with the DTS proposal.

“Cheaper and more cost effective methods can be determined jointly with the private sector through dialogue under the recently launched multisectoral Anti-Illicit Trade Committee (AIT Committee) which seeks to draw on the dual strengths of Industry knowhow from the private sector and the enforcement capabilities and capacities of Law Enforcement Agencies such as the Zambia Revenue Authority, Drug Enforcement Commission, and Zambia Police amongst others to curb illicit trade across a broad spectrum of products including excisable products”, she added.

She said given the recent establishment of the AIT Committee in November 2019, the ZRA should leverage the strength that comes with working with all parties in the public and private sectors who are members to address challenges arising from illicit trade and its negative impact on revenue collection.

Ms Zulu says ZAM remains open to further engagements with the ZRA towards the development of a workable solution that meets the shared growth aspirations of the Authority and Industry in developing Zambia into a prosperous middle-income country through enhanced tax compliance anchored in the predictable and sustainable long-term growth and development of Industry.

She has urged the ZRA to continue to promote Voluntary Compliance for those organizations that are fully tax compliant and this will remove the uncertainty in the market and avoid unnecessary operational cost escalation at industry level.

5 COMMENTS

  1. It’s a norm by the PF to do things without the involvement of other stakeholders. ZRA has rolled out a new system that hasn’t recognized old passwords and is sending random text messages. Why didn’t they prepare the public? These policies they make with bena Chanda Nyela in Chinsali will plunge this country into disarray

  2. “the Association says it is worth noting that the DTS solution is most effective where smuggling, counterfeit products, tax leakages and under declaration of production or sales volume is rife by registered industry players”.

    Are you saying these vices are not common in zambia? Smaggling in zambia is just too much.

  3. After being tax-compliant, your government tells you it has blown your money on fire trucks and super jets. Just what are we to fund PF??

Comments are closed.

- Advertisement -
Loading...
- Advertisement -

Latest News

COVID-19 must not derail my Government’s development agenda, President Lungu tells Provincial Ministers

President Edgar Lungu yesterday received regional cluster reports from provincial ministers and directed them not to relent as they...

Kitwe United Make Top Flight Return

Kitwe United needed the final day of the FAZ National Division 1 season to join Indeni, Prison Leopards and Young Green Eagles on the...

Shock and Anger As Stage For Nkana’s Coronation Up In The Air

Shock and anger cloaked a dramatic end to proceedings on the closing day of the season at Arthur Davies Stadium in Kitwe on...

It’ll be very difficult to unseat PF because of the unprecedented development Countrywide-Antonio

The ruling Patriotic Front (PF) Deputy Media Director Antonio Mwanza says it will be very difficult to unseat his party because of the unprecedented...

Government to soon fix the over 145 Km Mutanda-Mwinilunga Road in North Western Province

President Lungu has responded to concerns about the poor state of Mutanda/Mwinilunga road. And government says plans to reconstruct damaged sections to motorable standard have...

More Articles In This Category