THE Zimbabwe Revenue Authority (Zimra) is confident it will meet or surpass the Government's new revenue projection of $172 billion for 2020, more than double the initial target, as economic activity picks up following the national lockdown.
The revenue authority said the momentum in revenue collection is expected to be gained in the last quarter of the year, as the majority of economic sectors resume operations after several months of Covid-19 induced restrictions.
The new projection comes after Zimra reported that net revenue collections for the third quarter to September 2020, stood at $57 billion; representing a 27,16 percent increase above the quarterly target of $44,83 billion.
The out-turn far exceeded the $6,42 billion collected over the same period last year and nominally, the net revenue collections grew by 788,16 percent. All revenue heads registered positive growth in nominal terms.
Major contributors to net revenue collections for the quarter were: Individuals (15,26 percent), companies (14,63 percent), excise duty (14,17 percent), VAT on local sales (13,24 percent) and VAT on imports (13,08 percent).
The 2020 national budget, at $63,6 billion, was underpinned by anticipated revenues of $58,6 billion and a financing gap of $5 billion (which is approximately 1,5 percent of gross domestic product.
Positive variances on major tax heads and overall collection targets, have seen the Treasury recording budget surpluses that have been used to finance key infrastructure projects like roads, dams and bridges as well as intervene during periods of national disasters.
Zimra vice chair Josephine Matambo, said that the projected growth in revenue collections, is expected to come from increased productivity with the opening up of more business sectors in the economy.
"In addition, the Government's strategy to target low hanging fruits in various sub-sectors of the manufacturing industry is expected to attract the much- needed investment for domestic production," she said.
And with South Africa opening its borders, trade with its northern neighbour is expected to increase thereby feeding into higher collections in import duties.
South Africa is Zimbabwe's major trading partner in the region.
Further, Zimra said that the weather forecasts are projecting good rains in the coming farming season and this will significantly boost economic activity in all sectors as value chains can then be easily promoted.
Government has identified agriculture and mining sectors as providing quick economic turnaround for the country as it battles Western imposed economic sanctions.
The authority has already started aligning its strategies with the National Development Strategy (NDS) 2021 to 2025 and will play its expected role in mobilising domestic revenue for the national goals to be achieved.
The NDS is expected to lead the country into a middle income economy with a per capita of over US$4 000.
Zimra commissioner general Ms Faith Mazanhi said that the authority is given targets by the Ministry of Finance and Economic Development, which the national revenue authority simply has to work towards achieving.
But Ms Mazanhi pointed out that the revenue target set by the Ministry of Finance and Economic Development normally takes into account the level of inflation in the economy, previous performance and level of economic activity expected.