ZRA ties high PAYE to easy collection

ZRA ties high PAYE to easy collection
By Florence Bupe
Fri 12 Nov. 2010, 04:00 CAT

THE Federation of Free Trade Unions in Zambia has rebuked the government for suggesting that income tax charged on individuals will continue to be high because it is easier to collect.

Zambia Revenue Authority (ZRA) Commissioner General Wisdom Nhekaira on Tuesday informed the parliamentary committee on estimates that pay as you earn (PAYE) would remain high because it was easier to collect it at the source than corporate tax.

FFTUZ president Joyce Nonde-Simukoko charged that the government was being lazy by failing to broaden the tax base to relieve the narrow formal sector from paying high taxes charged on their income.

“What has been happening over the years is a sign of leadership failure. Government has failed to come up with ideas to capture income from the informal sector, and they do not realise that they are losing a lot of money in the process,” Nonde-Simukoko said.

“The fact is that the formal sector has continued to shrink and so the few people employed in this sector are over-burdened.”

Nonde-Simukoko said the problem of high PAYE was further aggravated by unattractive salaries in most formal employment sectors, especially the civil service. She expressed disappointment that the government had not bothered to explain to the public sector the challenges they faced in mobilising the informal sector.

Nonde-Simukoko also reiterated the urgent need for the government to revisit the issue of the windfall tax as a means of enhancing the country’s treasury.

“We have differed with government on the subject of the windfall tax and we are still aggrieved that our views have not been taken into consideration. We are not suggesting that taxes on the mining houses should be punitive, but government has to find a way of taxing the mines in a way that will benefit both the country and the investors,” said Nonde-Simukoko.