1. SOLVING THE PROBLEM OF TAX
ADMINISTRATION IN ZIMBABWE
TERERAI MURIDZO
FINANCING FOR DEVELOPMENT
WORLD BANK

2. REASONS FOR GOVERNMENT & PRIVATE SECTOR
PARTICIPATION IN TAX ADMINISTRATION
 According to Aidflows, Zimbabwe obtained
$USD247.29(38% ODA Commitments) for the health and
population sector. This amount contributed significantly in
reducing major diseases like AIDS which were ravaging the
nation. According to the 2010 Zimbabwe MDG Status
Report, the estimated rate for AIDS in adults declined from
23.7% in 2001 to 18.4% in 2005. The national AIDS 2010
Report shows the adult prevalence rates to have been
16.1% in 2007, 15.1% in 2008, and 13.7% in 2009. This
consistent reduction is a significant achievement.
 As shown by the chart, ODA Commitments to Zimbabwe
are insufficient especially to infrastructure development
for power generation sectors water and health thus
leaving domestic resource mobilisation (DRM) as the only
available source to finance development. To ensure this
succeeds, the country’s tax administration has to be
changed.
0%0%
2%
4%
38%
16%
4%
24%
10%
2%
0%
ODA Commitments(ZIMBABWE)
Action relating to debt
Administrative costs
Economic infrastructure and
services
Education
Health and population
Humanitarian aid
Multisector/cross-cutting

3. OBSTACLES
 The country has also faces recurrent
humanitarian disasters such as droughts.
Droughts have recurrent frequently every
decade since 1992 with an estimated 1, 5
million of the populace facing imminent
starvation.
 Zimbabwe received $61.25 of the
disbursements in this sector. Education
sector is also underfunded receiving
$27.31 of disbursements .According to Jan
Ellasson (Video) development cannot be
achieved without human rights and peace
.Education is a human right and leads to
eradication of poverty

4. OBSTACLES
 As a result ,the production sector has not
been spared with industry capacity
estimated at 34% and recently most
business have been on a “job firing spree”
in order to remain viable with an
estimated 20000 jobs loses in 2015 alone
to date. The production sector received
2% of ODA disbursements

5. SOLUTIONS TO INCREASE DOMESTIC RESOURCE
MOBILIZATION THROUGH TAX ADMINISTRATION
 Zimbabwe needs technical assistance to ensure adequate and
appropriate funding. The financial services sector need to be
properly supervised to ensure increased funding. The sector is
currently in reverse mode with the financial market in bearish
mode. The derivatives market is nonexistence and when
established acts as a catalyst in revamping sectors especially
the production sector with the establishment of Futures
Derivatives Market. The Infrastructure Development Bank of
Zimbabwe should also issue bonds to mitigate recurrent
humanitarian disaster , and power generation projects.
 According to Bertrand Badre (Video ), bank offers such
technical assistance as previously done in Zambia. Such
assistance leads to jobs and higher incomes. In addition, this
leads to public savings mobilization, pension contributions
and tax revenues which is fundamental for Domestic
Recourses Mobilisation.

6.  In addition the country has also engaged IMF in its initiative to increase foreign direct
investments (FDI). IT has pledged to clear its USD $1,8 billion by April 2016. The IMF in return
will offer USD$ 500 million credit facility if the country commits to this pledge. Increase in FDI
will lead to both eradication of poverty and employment of masses leading to increases in tax
revenue through corporate tax and pay as you earn.
 Corruption can be eradicated through the 2C’s of Capacity and capture with both requiring
political will involvement.
SOLUTIONS TO INCREASE DOMESTIC RESOURCE
MOBILIZATION THROUGH TAX ADMINISTRATION