Formalise and pay tax, Govt to informal traders

Government is eager to formalise and earn tax from the informal sector, who have been allowed to resume operations albeit under strict conditions.

In easing the Covid-19 national lockdown on June 12, 2020, President Emmerson Mnangagwa allowed some traders in the informal sector to reopen but excluded small scale miners, taxicab operators, omnibus or goods vehicle, informal cross border trader and operators of a restaurant or bottle stores.

The president directed those allowed to trade to start registering their businesses in order to resume their operations.

In a press release, the Ministry of Women Affairs, Community, Small and Medium Enterprises (SMEs) Development, concurred that the informal traders allowed to operate are to be subjected to guidelines set in the Statutory Instrument 136 of 2020 and would be asked to prove their compliance to the requirements to the authorities if asked to do so.

“Operators who are operating from designated workspaces owned by local authorities and those requiring to be allocated working space and therefore being advised to approach their respective local authorities to be registered with their local authority for the purpose of getting licences and paying presumptive tax in terms of the 26th Schedule to the Income Tax act,” said the SMEs ministry.

The ministry said operators who are operating from privately owned premises should also formalise their tenancy with their lessors and obtain proof they notified the lessor of the type of trade or operation they are engaged in.

“This is for the purpose of being charged presumptive tax on the rentals paid in terms of the 26th Schedule to the Income Tax Act. The operators are also required to have council licences.

“Operators who operating from their own premises should get council licenses and approach the Zimbabwe Revenue Authority (ZIMRA) to be registered under appropriate tax head. The informal traders who are to open for business would be asked to prove their compliance to the requirements mentioned above to the authorities if asked to do so,” advised the parent ministry

The informal traders, would also be required to comply with the already set COVID-19 public health requirements, which include handwashing and sanitising facilities, temperature taking, wearing face masks and social distancing and other measures unique to the respective informal market place, said the parent ministry.

The SMEs ministry urged local authorities to make sure these workspaces have the basic water and sanitation facilities plus facilitate for traders to obtain the relevant licences.

In addition, the ministry noted that in cases where there are workspace constraints, a rotation system should be employed where operators alternate based on their own agreement on who comes to trade and on which day.

“The informal sector players will be called upon to exercise high levels of discipline in observing laws and regulations. Association leaders or management committees of informal market hubs are hereby given the responsibility of making sure that all the regulations are followed. Failure to comply will result in the respective informal market being closed,” the ministry said.

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