Zambia Revenue Authority Commissioner General Kingsley Chanda has applauded government’s decision to re-introduce Value Added Tax (VAT) in the 2020 budget, pledging to implement it with renewed vigor.
In a statement, Wednesday, Chanda stated that the ZRA would immediately work to address the compliance and administrative challenges especially falsified refund claims, double claims and transfer pricing through over invoicing.
“Zambia Revenue Authority is pleased with the new VAT measures proposed in the 2020 budget by the Minister of Finance Honourable Dr. Bwalya Ng’andu, MP. The decision by Government to maintain the Value Added Tax will be implemented by ZRA with renewed vigor and initiatives based on smart technologies. To ensure the effective implementation of VAT, the ZRA will immediately undertake to address the compliance and administrative challenges especially falsified refund claims, double claims and transfer pricing through over invoicing. As the body charged with the responsibility of administering tax policy on behalf of Government, the Authority fully supports all government policies including the maintenance of VAT,” Chanda stated.
Chanda said the authority was upgrading the Tax Online system for domestic taxes, among other measures.
“To this end, the Authority is undertaking the flowing steps: Upgrading the TaxOnline system for domestic taxes and interface it with customs system to ensure that all claims of refund for import VAT paid to Customs Services during importation of goods are validated through systems based controls against data in the customs system; Measures are being put in place to ensure the mandatory use of Electronic Fiscal Devices (EFDs) for VAT and other tax types and facilitate accreditation of additional EFD distributors and Virtual EFD software suppliers and vendors; Making it mandatory to capture and electronically transmit to ZRA the Taxpayer Identification Number (TPIN) and the Names of both the buyer and seller of goods and services in all Business to Business and Business to Government transactions; this has already been implemented across businesses that include chain stores and other VAT registered suppliers,” Chanda stated.
“Two new units have already been set up to enhance data analytics and bulk data matching with third party institutions and to enhance enforcement and compliance activities; Implementation of stiffer penalties for evasion including prosecution and ensure timely audits of VAT claims, including outsourcing services of external forensic auditors whenever necessary.”
He expressed optimism that the new measures would help address the revenue leakages the country was currently facing.
“We believe the new tax measures proposed under VAT will therefore help to curb the revenue leakages. The Authority believes that the comprehensive tax review of the tax system which the Government intends to undertake as pronounced in the 2020 Budget will promote investment and broaden the tax base through increased economic activities. The Authority shall continue to take actions to ensure that our tax regime is transparent, professionally managed and sustainable,” stated Chanda.
About a fortnight ago, Economist Professor Oliver Saasa challenged Chanda to come out and state what he thought about Minister of Finance Bwalya Ng’andu’s competence after he publicly stated that he believed Sales Tax was the way to go.