Chinamasa extends olive branch to Zinara

HARARE - Zimbabwe National Roads Administration (Zinara) income will now be exempt from income tax, Finance minister Patrick Chinamasa said.

In General Notice 274 of 2017 published in the Government Gazette of May 19, 2017, the Treasury chief announced that in terms of the Third Schedule of the Income Tax Act, the statutory board was now exempt from paying the tax, adding the law would be applied retrospectively and Zinara would not be getting refunds.

“…Hereby declares that the income accruing to Zinara to be exempt from income tax with effect from February 1, 2009.

“The consequence of this declaration is that all income tax paid by Zinara prior to the promulgation of this notice shall not be refunded,” he said.

Zinara, responsible for the management, maintenance and development of Zimbabwe’s national road network gets most of its income from vehicle licensing and the country’s toll gates.

It collects around $130 million annually from road access fees, vehicle licensing fees, transit fees and fuel levy, among other revenue streams, for routine maintenance of roads.

According to the Third Schedule of the Income Tax Act, some of the organisations enjoying this privilege are local authorities, the Reserve Bank of Zimbabwe, the Zambezi River Authority and the Post Office Savings Bank (POSB), whose receipts and accruals of are not subject to income tax.

Debate over the use of funds administered by Zinara has always been an issue of contention and reached fever-pitch following a public spat between Harare mayor, Bernard Manyenyeni and Local Government minister Saviour Kasukuwere recently.

Zinara — which since the year 2017 spent an estimated $45 million on road rehabilitation — has approved plans to borrow up to $100 million from local banks to repair the country’s road network that has been affected by heavy rains.

Reports indicate that Zinara shareholders approved the decision to borrow, with management pursuing the route.

“We are looking to borrow anything from $50 million up to $100 million. The purpose of which is specifically to attend to the road network in light of the unprecedented collapse due to heavy rains which we received,” board chair Albert Mugabe was quoted as saying.

However, market watchers have always contended that the roads administration body could do more for the country’s deplorable roads as Zimbabwe’s roads have been left in a deplorable state by heavy rains. Bridges have been swept away by floods while major roads and highways are littered with potholes, posing a risk to motorists.

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