Decision to abandon Sales Tax is final – Ng’andu

Finance Minister Bwalya Ng’andu says the decision to abandon the introduction of sales Tax is final.

Dr. Ng’andu says government wanted to abandon VAT because it had too many leakages in the collection process of tax, but has decided to continue with the policy after sealing all the loopholes.

The Minister says government was having serious challenges with VAT refunds because of numerous leakages in the VAT collection process.

He says changing the policy from the VAT to sales tax was not the best solution to the challenges government is facing with tax refunds; hence it has simply made changes on the same policy to avoid accumulating refunds.

Speaking at the 2020 Budget Breakfast meeting organized by Deloitte Zambia in Lusaka, Dr Ng’andu has also optimistic that the Zambia Revenue Authority (ZRA) will next year surpass its tax revenue collection target.

He is happy that the Authority has done well in terms of meeting its revenue collection target this year.

Dr Ng’andu says government is trying to raise about K73 billion from taxes that ZRA will have to do some serious running. 

Speaking at the same meeting, Deloitte Zambia Chief Executive Officer Humphrey Mulenga says the plan to face Zambia’s external debt challenge head on, through implementation of austerity measures and refinancing of existing loans, is a positive move.

Mr. Mulenga says this will improve liquidity in the economy and assist, in part, to drive economic growth.

And Mr. Mulenga says the ministry’s swift call on the Sales Tax versus VAT issue is commendable.