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26 March 2018 Zambia Revenue Authority initiates comprehensive mining tax audits The Zambia Revenue Authority (ZRA) has announced plans to commence detailed tax audits on all mining companies for compliance with respect to all applicable taxes. This is to ensure all taxes are duly collected in line with the country's 2018 theme of "Rewarding compliant taxpayers and punishing non-compliant tax payers to the maximum." In 2017, Zambia's Financial Intelligence Centre (FIC) disclosed that the country was losing US$3 billion annually due to illicit financial flows mainly perpetrated in the minerals sub-sector, where tax evasion in areas such as transfer pricing, over- and under-invoicing and trade mispricing is widespread. In a bid to allow taxpayers to bring their tax compliance up to date, the ZRA announced a tax amnesty that expired on 30 September 2017.1 With the end of the amnesty period, the ZRA has announced detailed audits on all mining companies beginning 26 March 2018. The audits will cover compliance with respect to all applicable taxes for the last six years. However, should initial findings reveal a pattern of systematic tax evasion, the audit will extend beyond the six-year prescription period. All companies and relevant stakeholders in the mining sector are encouraged to urgently review their tax affairs and submit voluntary disclosures before the commencement of the audits. 1 See EY Global Tax Alert, Zambia Revenue Authority extends tax amnesty on interest and penalties, dated 4 August 2017.
Document ID: 2018-5465 |
