The Purse of Zambia: An Insight Into the Operations of Zambia Revenue Authority. Is the Establishement of this Institution the MMD Government's Success Story
Date
2013-10-29
Authors
Tresford, Chali
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Abstract
Zambia, like most countries in the world, has to generate revenue. With the privatisation of State Owned Enterprises (SOE), especially the Copper Mines, Zambia's revenue is mostly generated locally. This local revenue is mainly generated from taxation. This includes direct and indirect taxation. Direct taxes are levies on the income and gains of both individuals and corporations. Indirect taxes are levied on goods and services by increasing their cost.This revenue is important to finance education, health, transport and communication. It is also used to redistribute wealth between the rich and the poor, to allocate resources in the economy and to maintain and achieve goals of economic policy like employment and economic growth. As stated earlier, most SOE have been privatised. Whether wrongly or rightly or for profit or for a song, is not the subject of this dissertation. But privatisation has made government lose a lot of revenue especially in form of direct taxes through job loses. Therefore, government saw a greater need to recover this loss and generate more revenue.To do this, government had to consider the set up, the operations, investment, management, autonomy and how robust one major government department was: The Department of Taxes and of Customs and Excise in the Ministry of Finance. This
Department was disengaged and the Zambia Revenue Authority (ZRA) was set up on 1st April 1994 by the Zambia Revenue Authority Act Cap 321 of the Laws of Zambia.From inception, ZRA has established its authority by being robust, efficient, effective, by meeting its revenue targets and by prosecuting the tax evaders. This has led to this institution being on e of the most admired, feared and respected in the country and outside.This dissertation considers the insight of the operations of ZRA. What has made it be the way it is and where it is today. What laws it administers, taxes it collects and how it is managed. At a time when the Movement for Multi -Party Democracy (MMD) government has been accused of corruption and economic plunder, could the creation of ZRA be said to be the MMD Government's success story? Can it acquit the plunderers?There is need therefore to understand this institution in the way it operates. An insight into its operations is essential if it is to be said that it is the purse of Zambia. To put it loosely, ZRA is 'feeding' Zambia. Further, there is need to understand the extent to which government is involved in the operations of ZRA.This research is important to the Zambian jurisprudence regarding taxation and revenue collection. The research is firstly intended to contribute to, and provoke thought regarding the operations of ZRA in particular and revenue collection in general.
Chapter one traces the history of taxation. The chapter reveals that Africans in particular had been paying tax even before colonialism though not in the context it is understood today. Further, the chapter discusses the measures taken by the settlers to force indigenous people to pay tax. Finally, it attempts to define tax, state its purpose, effects, types, principles and attributes.Chapter two discusses the establishment of Zambia Revenue Authority (ZRA), the logo and its meaning and the various laws enforced by ZRA. It begins by presenting the arguments of the then Minister of Finance Emmanuel Kasonde, in Parliament in support of establishing ZRA. The chapter demonstrates that the logo of ZRA has a deep meaning suitable to its work. Lastly, it is discussed that Zambia Revenue Authority enforces three principal Acts of Parliament; namely the Customs and Excise Act, the Value Added Tax Act and the Income Tax Act.Chapter three argues that Zambia Revenue Authority (ZRA) works on revenue targets. Each year Parliament and the International Monetary Fund (IMF) give them a target to meet. In order to do this work, ZRA is divided into operating divisions. Under these divisions, various duties and taxes are collected. Being such a robust institution, ZRA is not an island. It administers a number of Trade Treaties and protocols. These are also discussed in this chapter.Chapter four considers the political interference in ZRA. It states that the ZRA Act makes it very easy for government to control ZRA. The chapter also considers whether the
establishment of ZRA can be said to be MMD Government's success story bearing in mind accusations of economic plunder and corruption generally leveled against it.Chapter five is the summary of the dissertation., It also makes suggestion ob how ZRA should be made more effective to further enhance revenue collection in Zambia.
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Finance, Public-Zambia