The Zimbabwe Revenue Authority (ZIMRA) has initiated a comprehensive operation aimed at targeting businesses that evade taxes and undermine the Zimbabwean currency, known as the ZiG (ZWG). This decisive action follows a clear mandate from President Emmerson Mnangagwa, who recently warned economic saboteurs that the government will protect citizens from exploitative business practices that harm the economy.
ZIMRA’s initiative is aligned with the National Development Strategy and aims to bolster resource mobilization for essential national development projects. The tax authority has established an automated and confidential whistle-blowing platform, encouraging the public to report businesses that refuse to accept the local currency or falsely claim that their Point of Sale (POS) machines are malfunctioning. This platform is a critical tool in the fight against tax evasion and the smuggling of goods.
In a statement, ZIMRA emphasized the importance of public participation in this effort: “Zimbabwe has been experiencing significant growth in infrastructure development, including the construction of roads, dams, and schools. This progress has been driven by domestic tax revenue mobilization, which is only possible if everyone plays their part.”
The authority is particularly focused on companies that compel customers to make payments solely in foreign currency, thereby stifling demand for the local currency. ZIMRA encourages corporate citizens and individuals to come forward with information about such malpractices, assuring them that their reports will be handled confidentially. Recent fluctuations in the value of the ZiG against the US dollar, particularly in the black market, have raised concerns about the currency’s stability. Despite an initial recovery after its launch in April, some businesses have reportedly manipulated prices by leveraging black market exchange rates, further complicating the situation.
Economist Marvelous Mandisodza believes ZIMRA’s actions could stimulate demand for the ZiG and reduce rent-seeking behavior. “Creating a whistle-blowing mechanism helps in curbing business malpractices. The measures by ZIMRA are noble, and we expect more from the Reserve Bank of Zimbabwe’s Monetary Policy Committee soon to stabilize the local currency,” Mandisodza stated. Chris Mugaga, CEO of the Zimbabwe National Chamber of Commerce, highlighted the importance of all stakeholders in supporting the ZiG to achieve national objectives. He cautioned against further money printing, stating, “The market should defend the ZiG because once the local unit fails, it will retard all efforts of having our currency.”
Kurai Matsheza, a prominent industrialist, echoed this sentiment, advocating for a floating exchange rate that would allow the market to establish its premium. “We also need to avoid printing money,” he added. The ongoing actions by ZIMRA highlight the intricate relationship between government policy, business practices, and currency stability in Zimbabwe. As the nation navigates these challenges, the success of ZIMRA’s initiatives will depend significantly on public cooperation and the commitment of all economic stakeholders to uphold the integrity of the ZiG.
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