The Reserve Bank of Zimbabwe (RBZ) and ZIMRA Thursday threatened punitive action on some errant businesses that were charging goods and services in foreign currency while paying taxes in local currency.
Government, through Statutory Instrument 85 of 2020, allowed businesses to start charging for their goods and services in both local currency and foreign currency.
The policy shift was a stopgap measure to allow locals to transact without leaving their localities to convert their foreign currencies into Zim-dollars when the Covid-19 induced lockdown restricted unnecessary movement.
Taking advantage of the policy ease, most businesses in the country are now charging their goods and services in foreign currency but issuing local currency receipts which enable them to declare their tax payments in local currency.
But speaking during a press conference Thursday, ZIMRA commissioner general, Faith Mazani warned dishonest businesses against the malpractices.
“Several companies are charging for their goods and services in foreign currency but declare such transactions as Zim-dollar.
“Where a sale has been conducted in foreign currency, associated taxes must be paid as such.
“We urge members of the public to report companies in this habit to enable us to redress the challenge,” she said.
The ZIMRA boss said the tax collector has since launched tax audits to monitor all foreign currency transactions being conducted by businesses.
“Those found guilty will be subject to the payment of punitive fines among other disciplinary measures,” Mazani added.
Also addressing the media, RBZ governor, John Mangudya said statistics being collated on the volume of transactions were not matching the taxes collected by ZIMRA.
“We have seen an increase in foreign currency transactions and the statistics indicate that 50% of these are being paid for in local currency and the remaining 50% in US$.
“However, the collections by ZIMRA are not reflecting this indicating lack of compliance by companies,” he said.
The central bank chief said to complement efforts by ZIMRA, RBZ will put in place a toll-free line within the Financial Intelligence Unit for whistle-blowers to expose errant companies.
He said non-compliant companies accessing foreign currency on the Foreign Exchange Auction risked being blacklisted from the market.
