Tax amnesty further extended
GOVERNMENT has extended the tax amnesty window by a further three months to the end of September, hoping this will persuade tax defaulters and evaders to own up on unpaid taxes through voluntary submission on account of forgiveness for a tax delinquency, the Financial Gazette’s Companies and Markets can report.
The extension followed the lapse of the previous extension which expired in June.
Finance and Economic Development Minister, Patrick Chinamasa, said he was hopeful more companies with outstanding taxes would come forward with undeclared tax liabilities.
The amnesty allows delinquent tax payers to settle their tax debts without having to pay penalties, or interest on account that they voluntarily informed the tax collector of their obligations.
“Government granted limited amnesty to taxpayers who disclosed their tax obligations within a period of six months beginning 1 October 2014, in order to encourage taxpayers to voluntarily regularise their tax affairs,” said Chinamasa.
“However, in view of the taxpayers’ concerns with regards to the inadequacy of the period within which to lodge the tax amnesty application, the tax amnesty period was extended to 30 June 2015. I further propose to extend the amnesty period by a further three months to end on 30 September 2015,” said Chinamasa.
Government had originally set March 31 this year as the deadline for delinquent taxpayers to come forward and declare their obligations.
But there was poor response to the amnesty with analysts saying this could have been due to fears of insecurity.
The amnesty covers tax offences committed during a six year period between February 2009 and September 2014.
Taxpayers granted amnesty would only pay the principal sum owed, free interest, surcharges and penalties and agree on a payment plan up to December 31, 2015.
However, the amnesty could have been hindered by the fact that many companies have calculated that having to pay taxes dating back six years, as many had defaulted since dollarisation, would push them out of business.
Many companies are either on the verge of collapse or have closed completely rendering thousands of workers jobless and adversely affecting revenue collection.
Apart from company closures that claimed thousands of jobs, the country’s frail economy has suffered knocks from retrenchments.
Furthermore, it remains difficult for the remaining few companies that are still operating to comply with tax demands.
Government offered the tax amnesty in an effort to persuade tax evaders to come forward with undeclared tax liabilities but the deal has not brought in much to the tax collector.