• This will increase tax remittances by Companies.
• The VAT refunds will also encourage those in the informal sector to formalize their businesses.
• This adjustment will benefit both government and the country.
Zambia Council for Social Development (ZCSD) says Zambia Revenue Authority (ZRA)’s decision to increase Value Added Tax (VAT) Refunds to businesses from K12 billion paid out last year to K16.2 billion this year will increase tax remittances by Companies.
Speaking in an interview with Money FM News, Council Executive Director Leah Mitaba said the VAT refunds will also encourage those in the informal sector to formalize their businesses.
Ms. Mitaba further stated that this adjustment will benefit both government and the country as the VAT collected will be put into good use.
“This increase is a positive step and we would like to encourage the government to continue on this trajectory because it will also enhance and improve VAT remittance by companies, it will also encourage those people that are in the informal sector to formalize their businesses because they know once they pay their taxes they remit the VAT they are able to claim back.”
“I think that is a welcome move for the business community, even for the country at large and the government itself because once that VAT is collected, ist something that the government is able to utilize and make money before the actual pay out,” Ms. Mitaba explained.
Zambia Revenue Authority (ZRA) has increased VAT Refunds from 12 billion last year to 16.2 billion this year.
ZRA Commissioner General Dingani Banda recently said the increase is aimed at ensuring cash flow in businesses, adding that the tax refunds are projected to rekindle microeconomic activity and also build good will among tax payers.
ZRA is targeting to collect K107.3 billion gross revenue.