By MacDonald Dzirutwe | Reuters |
Zimbabwe’s tax agency ZIMRA said on Thursday it failed to meet its 2016 revenue target by 4 percent, as the economy stalled and weak global commodity prices hit mineral royalties.
The southern African nation’s economy stagnated last year while its budget deficit exploded, putting political pressure on long-serving President Robert Mugabe’s government.
“The failure to surpass revenue targets in 2016 is largely due to the prevailing harsh economic conditions,” Bonyongwe said.
She did not give the agency’s revenue target for 2017 but said the tax authority would automate its revenue collection operations and deploy other measures to improve revenue.
Bonyongwe said mining companies paid $63 million in mineral royalties, far below the ZIMRA target of $110 million and blamed weaker mineral commodity prices for below par collections.
Zimbabwe holds the largest reserves of platinum deposits after South Africa and mining, mostly gold, platinum and nickel, generate more than half of the country’s export revenue.
Individuals and Zimbabwean companies owed the tax agency $2.7 billion at the end of December compared to $2 billion at the start of 2016, Bonyongwe said, adding that this was because most people were not meeting their tax obligations.
Zimbabwean businesses say they are struggling with a lack of cheap capital and shortages of foreign currency which have made it hard to pay for imports and external obligations.