THE COVID-19 pandemic will negatively impact revenue collections this year because of the decline in copper prices that has already affected Mineral Royalty Tax and projections for Corporate Income Tax from the mining sector, the Zambia Revenue Authority (ZRA) has disclosed.
In a statement, Wednesday, ZRA Corporate Communications Manager Topsy Sikalinda stated that the threat that COVID-19 posed to revenue collection efforts was already being felt as Zambia’s business environment was negatively affected.
Sikalinda stated that despite the Authority having exceeded its revenue collection target for the first quarter of 2020 by collecting K63.7 million above the estimated target of K13.1 million, the Authority was still worried about the negative effects that the deadly Coronavirus would have on revenue collection for the rest of the year.
“Despite the over-performance during the quarter under review, we are already feeling the threat that COVID-19 poses to our revenue collection efforts because the business environment has already been negatively affected. This will have a serious negative impact on our collections in the second quarter and possibly the entire year because of the decline in copper prices that has already affected Mineral Royalty Tax and projections for Corporate Income Tax from the mining sector. It is also expected that all other taxes will be affected negatively, but we are optimistic that the strategies we have put in place will mitigate the expected negative impact of COVID-19 on our economy,” stated Sikalinda.
“We have no choice, but to devise effective strategies to collect more revenue as the Zambian people need government services more than ever during this pandemic. We appeal to our tax payers and importers to be tax compliant.”
Meanwhile, Sikalinda stated that the ZRA refunded a total of K2.9 billion during the first quarter of this year in a quest to comply with the Value Added Tax (VAT) law and ensure that there was liquidity into the economy.