by Mirriam Chabala on 10 Dec 2018by Zondiwe Mbewe on 10 Dec 2018by Mukosha Funga on 10 Dec 2018by Zondiwe Mbewe on 10 Dec 2018
- Goal Diggers
by Stuart Lisulo on 10 Dec 2018by Zindikilani Banda on 10 Dec 2018by Stuart Lisulo and Sandra Mulenga on 10 Dec 2018by Diggers Reporter on 6 Dec 2018
by Zondiwe Mbewe on 10 Dec 2018by Zondiwe Mbewe on 7 Dec 2018by Zondiwe Mbewe on 7 Dec 2018by Zondiwe Mbewe on 6 Dec 2018
- Editor's Choice
by Linda Kasonde on 10 Dec 2018by Gerald Pule Mulao on 27 Nov 2018by Mwenya Musenge on 23 Nov 2018by Joseph Lungu on 21 Nov 2018
by Diggers Editor on 10 Dec 2018by Diggers Editor on 9 Dec 2018by Diggers Editor on 6 Dec 2018by Diggers Editor on 5 Dec 2018
by Zondiwe Mbewe on 28 Sep 2018by Tenson Mkhala on 28 Sep 2018by Thomas Mulenga on 24 Sep 2018by Sampa Kabwela on 8 Sep 2018
- Guest Diggers
by Linda Kasonde on 10 Dec 2018by Guest Digger on 5 Dec 2018by Obrian Ndhlovu on 4 Dec 2018by Sishuwa Sishuwa on 1 Dec 2018
Govt missed income tax collection target – ZIPARBy Stuart Lisulo on 4 Sep 2018
Government missed its target of K10.6 billion in income tax collection for the 2018 half-year period by around K500 million, owing to lower than projected collections, says ZIPAR.
According to a ZIPAR policy brief released last week, income tax collections were reduced to K10.1 billion for the half-year period ending June 30, 2018, from government’s targeted amount of K10.6 billion.
The policy brief, produced by ZIPAR research fellows Shebo Nalishebo and Florence Banda-Muleya, revealed that the income tax underperformance was largely on account of lower than projected collections for both mining and non-mining company income tax, among others.
“Against a target of K10.6 billion, income tax collections amounted to K10.1 billion. This was due to lower than projected collections for both mining and non-mining company income tax, Pay As You Earn, and withholding tax,” ZIPAR stated.
The policy think tank explained that the lower income tax earned pointed towards sluggish economic growth.
“Lower-than-projected performance of income taxes in the period is reminiscent of poor performance in 2017 and points to the sluggish economic growth experienced since 2015, and a multiplicity of tax rates and incentives,” it stated.
“Sluggish economic growth continues to prevail at present. GDP (Gross Domestic Product) growth was recorded at 2.6 per cent in Q1 2018, the lowest growth since Q4 2015, and a far-cry from the strong growth experienced before 2015. The low growth has resulted in declining taxable income. By not paying attention to, and sufficiently promoting private sector performance, the government is now missing out on taxable income.”
ZIPAR also stated that customs and excise duties also underperformed during the six-month period under review by almost K700 million.
“Customs and excise duties underperformed – against a target of K3.7 billion for the first six months of 2018, only K3.0 billion was collected. Particularly, excise duties had a relatively poor performance – against a target of K2.1 billion, collections from excise were K1.4 billion. This translates to an under-collection of K667 million during the first half of the year,” ZIPAR revealed.
“Considering that imports have been on the rise in the first half of the year, this seems to suggest a challenge on the domestic side of excise duties. Some measures introduced in the 2017 and 2018 [national] budget (such as increasing excise duty on air time from 15 per cent to 17.5 per cent; the aligning of excise duty to 125 per cent on methylated spirits) may either be having a dampening effect of reducing consumption and, therefore, the taxes, or have not been fully implemented.”
However, on the other hand, ZIPAR noted that VAT performance continued to outshine other taxes as government exceeded their half-year period target.
“Against a target of K5.5 billion, VAT revenue amounted to K7.9 billion in the first six months of 2018. The measures introduced in 2017 and 2018, including withholding the tax at source by appointed agents, seems to be paying off,” ZIPAR narrated.
Meanwhile, the policy brief showed that government’s half-year expenditure soared above the set targets.
“During January to June, 2018, the government’s expenditure was K40 billion or 55 per cent of the 2018 budget of K71.7 billion. This is higher than the projected expenditure of K34 billion. Interest payments have been the main drivers of this over-spending (owing to high debt accumulation) as well as capital expenditure (due to increased disbursements for foreign-financed capital projects,” stated ZIPAR.
About Stuart Lisulo
Stuart Lisulo is an experienced Zambian journalist with a focus on business news.
Email: stuart [at] diggers [dot] news0Related Items
Subscribe for email alerts
Weekly Most Digged
- December 2018
- November 2018
- October 2018
- September 2018
- August 2018
- July 2018
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- November 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
- May 2017
- April 2017
- March 2017
- February 2017
- January 2017
- December 2016
- November 2016
- October 2016
The News Diggers
Deputy News Editor
Plot No. Lus/9812/649-MC8
off Alex Chola Road
P.O. Box 32147
Telephone or WhatsApp:
+26-097-7708285, 095-3424603, 096-5815078
diggers [at] diggers [dot] news
editor [at] diggers [dot] news
Send this to a friend