Varsity don salutes ZRA tax waiver

Wed, 03 May 2017 10:38:27 +0000

By BUUMBA CHIMBULU

MOST businesses will find it easier to meet their tax obligations following the recent move by the Zambia Revenue Authority (ZRA) to waive interests and penalties by 100 percent, economist Lubinda Habazoka has observed.

Dr. Habazoka explained that the decision by ZRA would encourage business houses to be tax compliant as they had been given a chance to start afresh in their tax obligations.

“What ZRA has done is a good thing, I think the authority has realized that a lot of people in Zambia want to be tax compliant; in order to encourage them to do so they had to wave interest and penalties so that people can freely come on board and be compliant.

“Government has made it clear that they want to collect more taxes domestically and only through tax administration efficiency can we achieve a wider tax base and also compliance. So I think the ZRA move is to ensure that they make it easier for defaulting taxpayers to meet their tax obligations,” he said.

Dr. Habazoka however called for a simple and fair tax administration to encourage tax compliance.

He explained that there was a strong correlation between tax compliance and administration.

“Tax compliance is very much correlated to the tax rate, so the minister responsible for finance in the next national budget should consider reducing the number of taxes that businesses face.

“This will make it easier to make payments in terms of taxes and also the minister should look at ways of exempting certain businesses from paying taxes especially in the early stages,” he said.

Dr. Habazoka said high taxes discouraged entrepreneurs from starting up businesses.