Africa-Press – Zimbabwe. Beverage manufacturer Delta Corporation Limited has raised concern over the Zimbabwe Revenue Authority’s growing practice of issuing public notices that create legislative positions without backing from enabling laws.
In its annual report for the financial year ended 31 March 2025, Delta said this approach was contributing to policy and tax uncertainty, making it increasingly difficult for businesses to plan effectively.
In May, Delta reported confirmed tax payments amounting to US$254.15 million. This included US$230.35 million in indirect taxes such as value added tax, excise duties and the sugar tax, and US$23.8 million in income tax.
Compared to the previous year, indirect taxes rose by 19 percent, while income tax increased by 516.52 percent.
Delta noted that if an additional US$74.8 million in disputed tax assessments, currently under legal challenge, were to be included, the company’s total tax obligation for the period would rise to US$329 million. The company said:
A growing concern is the tax authorities’ practice of creating their legislative positions through public notices, which may not be supported by enabling legislation.
The law currently allows the tax authority to collect disputed amounts while the matter is under appeal through the courts.
This practice contributes to uncertainties, particularly when the tax positions adopted by the company concerning income tax and certain indirect taxes differ from those of the tax authorities.
These taxation and legislative challenges necessitate careful navigation and robust tax planning to mitigate their impact on our business operations and financial performance.
Delta Corporation disclosed that its operations are subject to a range of duties and taxes, including import duties, excise taxes, and other levies.
The company said these taxes are often adjusted with little notice, disrupting pricing structures and ultimately impacting product demand.
It cited the recent introduction of a sugar surtax on beverages, set above regional benchmarks, as an example of a policy that has triggered price increases and negatively affected business performance.
Delta further highlighted that the shift to a local currency, followed by the reintroduction of multi-currency trading, lacked clearly defined transitional tax measures, creating additional uncertainty for businesses. Delta said:
This lack of clarity, along with complex and inconsistent legislative changes regarding the currency used for the settlement of certain tax obligations, has created significant challenges for businesses. The company said:
The policy environment remains unpredictable and impacts our ability to plan for the future.
To note are issues related to currency management, exchange control and bank use policies, which affect the access to foreign currency and local bank notes or digital money transfers, thereby affecting our ability to supply products and the ability of consumers to purchase our products.
Delta added that the policies introduced to regulate the route to market have had an impact on distribution strategies, market access, and retail pricing.
As a result of these tax pressures, the company adjusted its product prices, achieving revenue of US$807.47 million for the period under review, representing a 5% increase from the previous year.
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