By NATION REPORTER
A REVIEW of the Tax Indebtedness of state owned enterprises has revealed that 20 subsidiaries have outstanding tax obligations to the Zambia Revenue Authority (ZRA) in amounts totaling K3.2 billion as at December 31, 2023.
According to the Auditor General’s Report on Parastatals, Zambia Railways Limited is owing K255 million with ZCCM-IH trailing with a whopping K244 million.
Other institutions that owe ZRA include Indeni Energy Company, which is owing K207 million, Times Printpak Zambia and Zambia Daily Mail both owing over K194 million while ZSIC General Insurance Limited had over K121 million to pay ZRA with ZSIC Limited standing at K100 million. The Lusaka South Multi-Facility Economic Zone is owing over K9, 000, Superior Milling Company Limited has over K2, 000 while Munushi Fruit Company owed just above K17, 000.
Other companies cited in the Auditor General’s report are Zampalm Limited with nearly K2 million, Nitrogen Chemicals of Zambia (NCZ) over K9 million, Zamtel nearly a billion Kwacha, Mulungushi Village Complex Limited over K16,000, Mulungushi Harbour Corporation Limited almost K7,000.
Mulungushi International Conference Centre has over K32 million, ZAFFICO over K10, 000 and Zambia Airways (2014) Limited over K19, 000.
“The situation presents serious implications for both the financial health of these subsidiaries and Zambia’s overall fiscal standing.
Many of these subsidiaries are grappling with operational inefficiencies, mismanagement of funds, or declining revenues,” the Auditor General’s report says.
“For instance, Zambia Railways Limited has been dealing with long-standing financial challenges due to underinvestment in infrastructure, aging assets, and management issues. These struggles may have hindered its ability to pay taxes despite the government’s role as the major shareholder,” the reports states.
The experts have stated that Zambia has faced economic volatility in recent years, largely due to fluctuations in commodity prices, particularly copper, which is a key driver of the Zambian economy.
The debt crisis and inflationary pressures have made it difficult for state-owned enterprises (SOEs) to generate stable revenues, thereby affecting their ability to meet tax obligations.