Diamond revenue more than doubles following lifting of sanctions

The lifting of sanctions on Zimbabwe’s diamonds which enabled the country to sell its stones openly at Antwerp and Dubai has boosted government revenues earning the country US$79.1 million in the first quarter of this year, more than double what the Zimbabwe Revenue Authority had anticipated.

Figures released by ZIMRA showed that the revenue authority had only estimated that it would earn US$31.2 million from mining royalties.

ZIMRA commissioner-general Gershom Pasi told a parliamentary committee last week that his organisation had exceed its quarterly target by two percent and this was a miracle because of the state of the economy.

He did not give figures then, but according to today’s Herald, ZIMRA collected US$834.6 million against a target of US$817.9 million.

Despite the reported decline in consumer demand, value added tax accounted for 25 percent of the revenue or US$211.6 million. Individual taxes brought in 23 percent (US$193.2 million) while excise duty accounted for 13 percent (US$109.7 million).

Mineral royalties accounted for 9 percent of the total revenue.

Pasi said revenue collections are expected to improve in the second quarter. Although he attributed the increased revenue to intensified efforts by ZIMRA to enforce compliance through follow-ups and audits, the current debate on corruption could have played a role because ZIMRA is one of the institutions where corruption is rife and everyone is now on his toes as they can be fingered any time.

Diamond mining companies are also under the spotlight following the community share ownership trust debacle and discrepancies over how much they have contributed to treasury in the past.

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