“The Weight of Taxation”

… ActionAid Zambia calls for a more inclusive and pragmatic approach to tax collection

By Francis Maingaila

Lusaka, Zambia24 – (9-07-2024) – The implementation of the Smart Invoicing System by the Zambia Revenue Authority (ZRA) has sparked significant debate and concern among the business community, particularly small to medium-sized enterprises (SMEs).

Faides TembaTemba, Country Director of ActionAid Zambia, highlighted pressing issues that require urgent attention from policymakers and stakeholders.

“The financial burden imposed by the Smart Invoicing System on businesses, particularly SMEs, is a major concern,” said TembaTemba.

“The costs associated with adopting and maintaining this digital tax solution exacerbate the already cumbersome array of taxes, fees, and licensing obligations. This strain threatens the financial health of SMEs and jeopardizes their ability to contribute to economic growth and job creation.”

According to Tambatamba the costs associated with adopting and maintaining the Smart Invoicing System exacerbate the already cumbersome array of taxes, fees, and licensing obligations.

She said the operational challenges, such as persistent electricity load shedding, further compound the difficulties faced by SMEs in utilizing the Smart Invoicing System effectively.

“The erratic power supply disrupts business operations and hampers the seamless integration of digital invoicing technologies,” TembaTemba explained.

She said ActionAid Zambia advocates for a pragmatic, phased approach to the adoption of new software and technologies, recognizing the diverse capabilities and readiness levels of local SMEs.

“We need an approach that takes into account the different needs and capabilities of SMEs,” said TembaTemba.

“A one-size-fits-all approach will only serve to further marginalize already vulnerable businesses.”

Amidst calls for efficiency in tax collection, there arises a pressing need for fair and progressive tax measures.

“The implementation of the Smart Invoicing System must be underpinned by policies that consider the economic realities of SMEs,” TembaTemba urged.

“A balanced tax framework fosters an environment conducive to sustainable business growth while equitably distributing fiscal responsibilities.”

The debate surrounding the Smart Invoicing System underscores broader questions about the relationship between taxation, economic development, and governance.

“Effective tax policies should enhance revenue collection, stimulate entrepreneurial activity, innovation, and job creation – pillars of a thriving economy,” TembaTemba emphasized.

As stakeholders engage in dialogue and decision-making processes, Tambatamba said it is imperative to prioritize collaborative efforts aimed at addressing the concerns voiced by SMEs.

“By fostering an environment of transparency, responsiveness, and inclusivity, Zambia can harness the potential of its business community to drive sustainable economic progress and alleviate poverty,” TembaTemba concluded.

“ActionAid Zambia’s advocacy for fair tax measures and pragmatic technological adoption reflects our commitment to advancing equitable economic growth,” said TembaTemba.

“By heeding these calls, policymakers can navigate the complexities of the Smart Invoicing System implementation with foresight and compassion, ensuring a bright and inclusive economic future for all.”