ZRA fails to collect over K1bn from the mines

Fri, 30 Dec 2016 14:06:36 +0000

By BUUMBA CHIMBULU

THE Zambia Revenue Authority (ZRA) will not be able to collect over K1 billion income taxes from the mines due to challenges the sector experienced in 2016, commissioner general Kingsley Chanda has said.

Mr Chanda explained that like other sectors, the mining sector was also hit with sudden volatility in the exchange rate resulting in low copper prices on the international market.

He told the media in Lusaka that 2016 had been a tough year for ZRA for various reasons including changes in macroeconomic environment.

“Sudden increase in the exchange rate made imports expensive. We also had challenges regarding copper prices as they were depressed most of the year and in the process mines could not pay taxes.

“Our biggest tax contributor, the mining sector declared losses, so we had over K1 billion which has not come from the mining sector as company income tax and that has affected our performance,” he said.

Mr Chanda, however, said ZRA was confident that it would meet the targeted revenue collection for 2016.

Meanwhile, Mr Chanda said the revision on mineral royalty tax from 20 to 6 percent during the mid-year had a serious knock on the Authority’s capacity to deliver revenues.

“We anticipate to meet our December target, we did very well in November. We are still confident to collect taxes and whatever will not be collected has an explanation, 90 percent of reasons for not meeting the target are outside the Authority’s control,” he said.

Mr Chanda also announced that the Authority had extended the waiver of penalties and interest to withholding tax on rental income.

He said the Authority would ensure it builds trust with its customers to promote transparency and more engagement on tax related issues.