HARARE - Tax collector Zimbabwe Revenue Authority (Zimra) reached the 2012 revenue target of $3,5 billion in the 11 months to November, Finance minister Tendai Biti said.

This comes on the back of depressed fiscal revenue flows in the first half of the year, forcing the country, which runs a cash-budget system, to review downwards the 2012 budget to $3,5 billion from $4 billion.

Biti said the improved performance in the third quarter helped boost treasury coffers.

“…we were able to pay bonuses to all civil servants and we are in the process of paying $75 million to most departments that are owed money by government,” he said.

November revenue reached $247,8 million against a target of $309 million. Of the total revenue, tax revenue was $234,3 million against a target of $275,7 million, while non-tax revenue was $13,5 million against a target of $33,3 million.

December revenue is projected at $401,8 million.

“Tax revenue contributed $2, 96 billion in November while non-tax revenue had $217,3 million. The sad news however is diamonds contribution. We had a cumulative diamond revenue of $45,7 million against an export of $600 million,” Biti said.

Diamond revenues recorded a shortfall of $229,3 million in the first half of 2012.

Biti said total disbursements for November amounted to $310,8 million, adding that of this amount, employment costs were 64,2 percent at $1 994,4 million while capital programmes accounted for 4,7 percent at $14,5 million.

Government revenues for September 2012 amounted to $337,58 million, bringing the cumulative total for the third quarter to $902,33 million. On a quarterly basis, revenue collections have been increasing steadily from $771,13 million in the first quarter to $902,33 in the third quarter.

The third quarter revenue outturn was 20,7 percent higher than corresponding quarter in 2011. Similarly, the $2,5 billion cumulative revenues to September 2012 were 19 percent higher than revenues for the same period in 2011.

In its Zimbabwe monthly economic review for November, the African Development Bank (AfDB) said the underperformances of revenues earlier in the year were undermining government’s capacity to implement public sector investment programmes.

Total expenditures for September 2012 were registered at $319,05 million, against planned expenditures of $381,34 million.

Cumulative expenditures to September 2012 amounted to $2,46 billion against cumulative revenues of $2,5 billion. Against the limited fiscal space, cumulative expenditures to September 2012 were 12,66 percent lower than the target of $2,82 billion.

“Of major concern is the expenditure mix, which has remained skewed towards the recurrent budget,” said AfDB.

“Recurrent expenditures continue to outweigh the growth-enhancing capital expenditure. The net effect of the current expenditure mix is that it undermines the growth potential of the economy.” - John Kachembere