1. What are Harmonized System Codes (HS Codes)?

HS Codes are a standardised numerical method (8-digit classification) of classifying traded products. They were developed by World Customs Organization (WCO) and designed for use in classifying goods when exporting and importing. Zimbabwe Revenue Authority (ZIMRA) has extended the use of HS Codes in classifying domestic of products and services when recording and transmitting sales transactions under Fiscalisation Data Management System (FDMS).

2. How to use HS codes when recording sales transactions on a fiscal device

All VAT registered taxpayers/operators are expected to configure their fiscal devices to assign applicable HS codes when making a sale transaction through a fiscal device

• For all invoice line items where VAT is charged at 0% or Exempted from VAT, a full eight (8)-digit classification HS Code must be captured when generating and/or recording a fiscal tax invoice.
• For all invoice line items where VAT is charged at standard rate (15%), the first four digits are required or optionally a full eight (8)-digit classification HS Code may be captured when generating/recording a fiscal tax invoice.

3. Is displaying HS codes on Fiscal Tax Invoices mandatory?

Displaying HS codes on issued fiscal tax invoice is optional and not mandatory. However, it is mandatory for any configured and interfaced fiscal device to be transmitting the recorded HS codes on issued Fiscal Tax Invoice to the Fiscalisation Data Management System (FDMS) whether displayed or not displayed on the issued/printed Fiscal Tax Invoice.

4. How to classify the domestic supply of services and other intangible products which are not classified on the Customs Harmonized System Codes e.g. Rentals, Consultancy etc.?

While HS codes are suitable for classification of physical products under customs environment, classifying domestic supply of services or intangible products is not available on the conventional HS Code list. Taxpayer are encouraged to use the fiscalisation general classification for services and assign applicable VAT rate accordingly as indicated below:

5. What are the uses of these HS Codes in Domestic Taxes when recording sales transactions?

              HS Codes are used for the following purposes;

• Harmonized classification of domestic supply of goods and services, thereby providing uniformity in identifying nature of transactions amongst national industries and sectors.
• To aid verifications of taxes applicable on domestic supplies made from imported and exported products
• Generating trade statistics for policy making and economic planning.

My Taxes, My Duties: Building My Zimbabwe

Disclaimer

This article was compiled by the Zimbabwe Revenue Authority (ZIMRA) for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority.

One of the key strategic projects that the Authority was running in 2022 was the Contact Centre Project which culminated in the Zimbabwe Revenue Authority (ZIMRA)  introducing a contact centre as part of its operations.  This new initiative is expected to have a significant impact on businesses and individuals who interact with ZIMRA on a regular basis.

The facility comes with a toll-free short code, 585, that is accessible across all networks with TelOne subscribers further having the convenience of another line to use, 08688007614. The toll-free line is accessible from anywhere in the country, eliminating the need for face-to-face interactions thereby reducing the time and cost associated with physical visits to ZIMRA offices. Furthermore, taxpayers can use WhatsApp, Email, Facebook and X to access the contact centre.

The introduction of the contact centre is a welcome development for businesses and traders in Zimbabwe as it offers a more convenient and efficient way of accessing information and services thereby improving trade facilitation in Zimbabwe. With a dedicated team of customer service representatives available to provide guidance and support, businesses and traders can navigate the complex regulatory environment with greater ease and confidence. This is particularly important for small and medium-sized enterprises (SMEs) who may not have the resources or expertise to deal with complex taxation and customs issues on their own. The customer service representatives are trained to handle queries and provide assistance on a wide range of issues related to taxation, customs, and other tax-related matters.

In addition to improving trade facilitation, the Contact Centre is also expected to enhance customer experience by providing a more convenient and accessible way of getting information and services. ZIMRA is demonstrating its commitment to customer service by providing a platform through which taxpayers can interact and get timeous feedback.  This should go a long way in contributing to a more positive business environment in Zimbabwe.

As ZIMRA continues to invest in modernizing its operations and improving service delivery, businesses and traders can look forward to a more streamlined and responsive revenue authority in the future. The expectation is to take service and customer experience to another level through this channel.

The Zimbabwe Revenue Authority (ZIMRA) bagged two awards at the prestigious Institute of Directors Zimbabwe (IODZ) Awards, which were held in Harare on 6 July 2023. The ZIMRA Commissioner General, Ms Regina Chinamasa, was crowned Director of the Year 2022 in the State Owned Enterprise and Parastatals Category and Women Director of the Year Award in the Women Director of the Year category respectively.

The Authority was recognised for its crucial role in promoting economic growth through revenue mobilisation and trade facilitation true to its mandate. ZIMRA managed to surpass its 2022 Annual Target by 24.14% with the nominal and real revenue growing 324.59% and 49.46% respectively.  Through Ms Chinamasa’ s leadership and guidance, ZIMRA has continued to consistently surpass revenue targets as set by the Ministry of Finance and Economic Development.

ZIMRA strives for excellent service delivery to its business partners and taxpayers in line with its motto “We are here to serve”. The Authority has harnessed technology to increase convenience to clients and reduce compliance costs for the taxpayers. Systems upgrade such as Asycuda, TARMS, e-Taxes, Single Window, Self-service kiosks have aided in efficient and effective service delivery. In addition to digitalization, other projects like the High Speed Scanners; Drones; Surveillance and Monitoring Centre; and FADMS are at advanced stages.

The Authority has successfully implemented the ZIMRA Contact Centre, which has transformed the tax and customs administration to a wholesome customer-centric experience. The Contact Centre has been well received by ZIMRA’s stakeholders and clients, due to swiftness in turnaround time thanks to a dedicated team of agents. The Client Satisfaction Index results have also shown an improvement in terms of service delivery, where ZIMRA achieved 67% against an annual target of 72% for the year reflective of improved customer service.

ZIMRA is a hub of regional and international tax information exchange by virtue of being a member of the Global Forum on Transparency and Exchange of Information for Tax Purposes. This is a multilateral body, which works in the area of transparency and exchange of information for tax purposes. The Forum is mandated to ensure a rapid and effective global implementation of the standards of transparency and exchange of information for tax purposes. Its work focuses on the exchange of information on request and automatic exchange of financial account information.

Ms Regina Chinamasa successfully implemented the Women in Taxation Forum, with the official launch event being held on 18 March 2022 in Mutare. This platform helps women in the taxation field to participate meaningfully in tax formulation as well as the administration processes. The mandate of the forum is to sufficiently empower and capacitate women and this is achieved through sharing ideas, creating networks and linkages while addressing matters that affect women in the taxation field.

Ms Regina Chinamasa is a staunch advocate of gender sensitive taxation policies evidenced by ZIMRA being part of The United Nations Development Programme (UNDP) Gender Seal, a volunteer certification programme which aims to recognise organisations that have made significant progress in promoting gender equality. The Seal aims to establish standards and performance benchmarks, provide a roadmap, concrete strategies and actions to put into practice institutional commitments; connect organisational structure with results and impact of public policies; and champion good performance and practices, and enhances institutional accountability on gender equality.

The Institute of Directors (IODZ) awards celebrates directors for their exceptional leadership and success. The awards are meant to recognise individuals contribution, strategy and corporate social responsibility.

By Linister Chivizhe

The World Customs Organisation (WCO) Regional Intelligence Liaison Office for East and Southern African (ESA) region, housed under Zimbabwe Revenue Authority, is holding its annual National Contact Points meeting in Zimbabwe’s tourist town of Victoria Falls from 27-29 August 2024. The meeting has a clear focus on strengthening intelligence sharing and forging new partnerships to compact the scourge of illicit trade. The three-day event, themed “Connecting the Globe through Intel Sharing with Old Partners as well as creating the new ones’’  brought together delegates from across the ESA region as well as representatives from RILO Western Europe, SADC Twix, WCO Headquarters and INTERPOL.

The workshop commenced with a warm welcome from ZIMRA’s Head of Compliance, Mr Adrian Swarres, representing the Commissioner General, Ms Regina Chinamasa. In his opening remarks, Mr Swarres lamented the low usage of World Customs Organisation tools in the Eastern and Southern Region (ESA), urging the National Contacts Points (NCPs) to ensure the effective utilisation of all the available WCO tools in fighting against illicit trade. He emphasised the importance of maintaining the integrity of the supply chain and pointed out the need to leverage WCO tools such as CEN, CENComm and the Global RILO network.

Addressing the NCPs, Mr Swarres probed into the findings of the WCO 2023 Illicit Trade Report. The report, he noted, identifies key areas of focus for enforcement activities, including cultural heritage, drugs, anti-money laundering, environment, intellectual property rights, health and safety, revenue and security. This comprehensive report serves as a roadmap for the region’s enforcement agencies as they navigate the complex landscape of illicit trade.

Building on Mr Swarres’ speech, Mr Ousmane Coundoul, WCO CEN Programmes Manager delivered a thought provoking speech where he expressed the critical importance of intelligence sharing between law enforcement agencies and all partners engaged in enforcement activities. He highlighted that challenges faced in combating illicit trade, protecting revenue, ensuring the safety and security of our society are multi-faceted and constantly evolving and indicated the need to join hands as no single agency or organisation can tackle these issues in isolation.

Mr Larry Liza, the WCO Regional Office for Capacity Building (ROCB), through a virtual speech, also highlighted the crucial role that NCPs play. He stressed that where there are changes in administration, NCPs, should ensure that handover and takeover processes are thoroughly conducted so that RILO can continue its functions without interruptions. In addition to that he pointed out that, all NCP should treat information requests with urgency, as issues related to security and enforcement cannot be taken lightly and any delays can have serious repercussions.

As the workshop continues over the next two days, delegates will have opportunity to delve more and deeper into the theme, and the workshop will feature case study presentations, panel discussions and working group sessions aimed at developing concrete strategies and action plans for ESA region for the period 2025 to 2025.

The Zimbabwe Electronic Single Window (ZESW) concept was introduced in 2022 as part of measures to enhance efficient clearance of legitimate traffic and trade facilitation at the country’s ports of entry.

The objective of the ZESW is to improve trade facilitation and to achieve efficiency and effectiveness in pursuing the goals of revenue collection, enforcement of trade laws, social protection, and providing business intelligence to the government.

Zimbabwe provides the gateway to Africa through the north and south corridor, hence efficient trade facilitation at the country’s ports of entry is key for the region’s rapid economic growth.

The ZESW initiative is also in sync with global trends on customs reforms and best practices, as well as a National Development Strategy 1 priority on trade facilitation.

Currently, the country’s ports of entry are manned by various government departments and agencies that have a critical legislative role in the trade facilitation matrix.

Under the Single Window initiative, ZIMRA as the lead agency has the role to ensure the coordination and harmonization of clearance processes at the country's ports of entry.

The project is in its second year and its first stage of implementation is set to be launched by the end of September 2023. The first phase saw an intensive mapping exercise and integration of all key processes on the Single Window platform.

The major beneficiaries of the single window initiative will be importers and exporters, shipping and freight forwarders, the transport sector, customs administration as well as government departments and agencies, whose mandate includes the movement of food, drugs, health, agricultural-related products, and environment.

Once the initiative is commissioned, clients and stakeholders will not be moving from one agency to another as all the regulatory and transitory services, processes and payments will be done online through a single platform, thus faster, better, and transparent.

The major benefits of the Single Window will be compliance among agencies, more efficient and productive use of resources, enhanced collection of fees, duties, and penalties; streamlined and automated compliance to transitory, legislative, and regulatory requirements, and most importantly predictability, convenience, and efficiency to all actors in cross border trade.

Other benefits include enhanced risk analysis, improved security, reductions in corruption and illegal trade activities, enhanced transparency, ease of access to trade statistics, and accountability.

The ZeSW rides on a robust digital platform and ZIMRA is already activating its system in readiness for the integration and data processing from other agencies.

The United Nations Conference on Trade and Development (UNCTAD) is supporting the ZeSW project as part of the harmonization of the customs service delivery initiative.

Other countries that have successfully implemented the single window concept include Jamaica, Rwanda, Uganda, and Kenya.

Commissioner General, Ms Regina Chinamasa, on 14 December 2022 donated grocery items and goodies worth ZWL10 million dollars to Chinotimba Old People’s Home, Rose of Charity Children’s Home and Abangane Shamwari Disability Organisation in Victoria Falls.

In an emotional delivery, the CG expressed gratitude to founders and overseers of the three Homes whom she commended for the great work that they are doing in taking care of the vulnerable.

“You are making positive contributions to our country and in particular Victoria Falls. It takes people with love, patience, generosity and determination to succeed in doing what you have been doing to keep these institutions running and that is why my team and I thought is wise to give you Christmas Cheer, so that this festive season; life is bearable for all of us.

Taking care of just one child can be a daunting task. Yet you are taking care of 39 or more children and the elderly. I am deeply humbled and wish you well in what you are doing. This is your vision and we can only come in and support the work you started with the few groceries we have,’ said Ms. Chinamasa.

The Commissioner General’s Christmas Cheer under the ZIMRA Charity Trust banner benefitted three organisations in Victoria Falls namely Chinotimba Old People’s Home, Rose of Charity and Abangane Shamwari Disability Organisation.

Over the years, ZIMRA has received overwhelming support from the corporate world through the Annual Charity Ball and other fundraising activities to assist the needy in our communities. In 2022, ZIMRA hosted two events, the Charity Ball and Charity Cocktail in an effort to continue to mobilise resources for disadvantaged communities.

The ZIMRA Charity Trust is responsible for managing the corporate social responsibility

programmes and projects of the Authority. The trust continues to spearhead Charity initiatives to better the lives of the less privileged members of society by offering a full scholarship for tertiary students.

The ZIMRA Charity Trust in 2022 put in place the sanitary wear campaign to not only donate sanitary pads to girls in disadvantaged communities. A number of ZIMRA staff responded to the call in 2022 and donated sanitary wear in their individual capacities and the Trust allocated resources in the ZIMRA region to purchase the sanitary wear for disadvantaged girls.

THE Zimbabwe Revenue Authority (ZIMRA) intercepted a major smuggling operation during the 2024 Easter Holiday at Beitbridge Border post, resulting in the seizure of a significant quantity of cannabis and cough syrup.

The combined efforts of the ZIMRA K9 team, officers, and law enforcement agencies successfully thwarted the illegal trade.

A staggering 113.7 kilograms of cannabis and 2 682 of 100 milliliters Benylin cough syrup liquid bottles with an estimated total value of an astonishing USD 140,520.00 was recovered.

During a routine K9 search at the Light Commercial Terminal Shed, the K-9 dogs detected suspicious cargo concealed within a South African registered Toyota Quantum.

The vehicle, which purportedly had passengers and groceries, was found to be carrying packages of cannabis and cough syrups.

ZIMRA officers promptly removed the illicit substances from the trailer compartment after the K-9 dogs alerted them. Upon noticing the dogs, the driver and crew absconded, leading to the confiscation of the vehicle and its contents.

Initially, the officers discovered approximately 29 kilograms of cannabis and 672 bottles of Benylin cough syrup.

However, the K9 staff continued their investigation, determined not to let the case go cold.

With the participation of other border stakeholders, a thorough search was conducted, during which K9 Grace, a highly trained and perceptive dog, detected further contraband beneath the trailer.

The confiscated contraband was promptly secured, and efforts to apprehend the suspects were intensified.

The police remained resolute in their commitment to bring the culprits responsible for this illegal operation to justice and prevent further smuggling activities.

Over the past few years, ZIMRA has successfully foiled numerous attempts by smugglers to traffic illicit drugs within the country, effectively disrupting their unlawful operations.

The Commissioner of Customs and Excise, Mr Batsirayi Chadzingwa, emphasized ZIMRA's unwavering dedication to safeguarding our borders and safeguarding civil society. He stated, "Our K9 unit has undergone extensive training to detect illicit drugs, and this recent operation exemplifies our resolute commitment to combating drug trafficking and preserving the well-being of our communities."

Additionally, he underscored the significance of collaboration between ZIMRA and various law enforcement agencies as a collective endeavor to combat the illicit drug trade.

The Tax and Revenue Management System (TaRMS) is set to revolutionalise the tax administration terrain in the country through an efficient, effective and easy-to-navigate system based on a digital platform.

TaRMS is a product of the Zimbabwe Revenue Authority (ZIMRA)’s business process re-engineering (BPR) programme which was launched in 2022.

The BPR identified digitalization as the key aspect of improved service delivery to ZIMRA’s diverse clients and the configuration of TaRMS commenced in 2022 following an intensive user needs analysis and assessment.

Domestic taxes are crucial to national transformation and economic viability hence an efficient tax collection process is imperative.

TaRMS is being introduced to close the gaps that have historically affected the efficient collection of revenue.

The new system is set to be commissioned in October 2023 and is aligned with the National Development Strategy 1 priorities which include the ease of doing business, widening the tax base, and enabling a digital economy.

A simplified tax system that is effective and efficient increases compliance levels among taxpayers while reducing the cost of collection.

The TaRMS modules are set to enhance taxpayer experience on any device, automate complex tax processes, and improve tax collection.

The system has the capacity to go beyond collecting tax and revenue as it will be able to give full data analytics that will enable timely decision-making while empowering taxpayers to do self-service such as data entry.

Currently, ZIMRA is undertaking a taxpayer data cleansing exercise to ensure robust data integrity. TaRMS will be data-driven and this will result in increased taxpayer engagement, reduced cost of collection, prevention of fraud, and improved voluntary compliance.

By October 2023 when TaRMS goes live, the taxpayers will be able to seamlessly and efficiently process, on any device, taxpayer registration or reregistration; filing and returns processing; payments; refunds among other processes.

The system will also be integrated with enterprise Bus, ASYCUDA, SAP-FI, Registrar of Companies, Deeds & Intellectual Property, Civil Registry, and Banks.

ZIMRA is undergoing an intensive digitalization and transformation agenda and simplifying business processes and accessibility of the service platforms are some of the key objectives.

ZIMRA’s Five Year Strategic Plan envisions maximizing revenue collection, strengthening the institutional image, and increasing voluntary compliance by 2025 and an effective and efficient tax management system is central to the attainment of these strategic objectives.

TaRMS is being funded by a grant from the African Development Bank (AfDB) and by the Government of Zimbabwe.

Remarks by Board Chairman, Mr Antony Mandiwanza

It is my pleasure to present ZIMRA’s Annual performance for the year ending 31 December 2022.

The global economic growth for 2022 slowed down to 3.2 from 6% in 2021 as the rising cost-of-living, tightening financial conditions in most regions, the Russia-Ukraine conflict and the lingering COVID-19 pandemic all weighed heavily on the global growth projections.

Following further relaxation of COVID-19 related restrictions, domestic economic activity relatively improved in 2022 on the back of improved performance in various sectors led by a boom in Agricultural production. 

The improvement was supported by tight monetary and fiscal policy measures, which helped stabilize the domestic economy.  The stability improved the generation of taxable income from companies, employment and trading of goods and services among others.

The Zimbabwe Revenue Authority, hereafter referred to as the Authority, managed to surpass the 2022 Annual target by 26.47%. Between 2021 and 2022, the nominal and real revenue grew by 332.3% and 39.8% respectively, therefore the Authority contributed significantly towards Domestic Resource Mobilisation which is necessary for the implementation of Government’s National Development Strategy (NDS 1) and the National Vision 2030 - “Towards a Prosperous and Empowered Upper Middle Income Society by 2030”. This was achieved through directing management on strategic areas aimed at increasing revenue collection, reducing cost of collection, deepening and widening the tax base, embracing digitalisation, innovation and improving service delivery.  

Further, ZIMRA, implemented some transformative strategic projects to improve the Authority’s ability to deliver on its mandate and support. These include new Commercial and Passenger terminals that were commissioned under the Beitbridge Modernisation project. In addition, heavy-duty scanners and long-range drones were procured to mitigate revenue leakages.

ZIMRA also played a critical role in the Facilitation of Trade and Travel, to improve the country’s Ease of Doing Business index.

In 2023, the Authority will continue implementing the transformative projects that are underway and will be pursuing revenue enhancing measures targeted at increasing the tax base and ensuring high compliance levels with taxation laws. To this effect, the revenue is expected to grow to levels above 19% of GDP.

Governance

There were key changes within the governance structures of the Authority in 2022. These included the appointment of new board members and substantive appointment to executive roles, the details of which will be covered in the main report. A new Commissioner General, Regina Chinamasa, was appointed with effect from 1 September 2022. I once again extend my heartfelt congratulations to her and commit the Board’s support as she directs the day-to-day operations of the Authority. 

Acknowledgement

My appreciation goes to the ZIMRA Board, Management and staff for their dedicated commitment that allowed ZIMRA to fulfil its mandate.

I also express my gratitude to the Minister of Finance and Economic Development, Honourable Professor Mthuli Ncube, the Permanent Secretary, Mr George Guvamatanga, and the entire Ministry for providing timely and adequate policy support during the year. I am truly grateful for the requisite support rendered.

Finally, I would like to thank our valued compliant taxpayers for paying their dues in full and on time.  

I thank you.