TEA producer, Tanganda Tea Company Limited, reduced its taxes by 24,1% to US$2,05 million in its financial year ended September 30, 2024, after implementing a compliance-focused and risk-managed tax strategy.
In the comparative 2023 period, Tanganda made tax payments of US$2,7 million.
During the period under review, Tanganda paid US$219 082 in corporate tax, value-added tax (US$428 239), import duty (US$49 405), pay as you earn (US$1 276 549), withholding tax (US$41 151) and (US$38 294) in Aids Levy.
The reduction in Tanganda’s tax obligations comes as firms, such as Innscor Africa Limited, National Foods Holdings Limited and Delta Corporation Limited, have complained of a high tax bill.
Revealing the tax strategy in its annual report for the period ended September 30, 2024, Tanganda said the plan ensured adherence to the country's tax laws.
“The company complies with the rules and regulations of the country, which include payment of taxes due to the Zimbabwe Revenue Authority [Zimra]. The board, as represented by the Finance director, is accountable and
responsible for the execution of the tax strategy,” Tanganda said.
“The Finance director implements the approved annual tax strategy. As a company, values of honesty and integrity are upheld to ensure the discharge of commitments to tax authorities for economic growth. To manage tax and related impacts, proactive actions are implemented to ensure compliance.”
- Tax strategy pays off for Tanganda
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Tanganda said employees were trained regularly to stay updated on tax regulations and to participate in seminars for continuous professional development in the tax field.
“Tax consultants are engaged to address areas of legislative interpretation that may be unclear. In addressing any negative impacts, we communicate with tax authorities through written correspondence and also utilise tax consultants to resolve any outstanding queries,” Tanganda said.
“We have implemented various processes to track the effectiveness of our tax management activities. These include Zimra ledger reconciliations to ensure timely submission of returns and payments, external audits of tax computations and health tax check reviews conducted by tax consultants to assess compliance and identification of risks.”
The tea producer said these processes assisted in the evaluation of the effectiveness of its tax management practices and identified areas for improvement.
“To evaluate our progress, we have set goals, targets and key performance indicators. Our goals include timely payment of taxes, correct calculation of taxes, and timely submission and filing of tax returns,” Tanganda said.
“Key performance indicators such as the quantum of interest and penalties from regulatory authorities and any additional assessments from tax authorities help us assess our progress towards meeting these goals.”
Tanganda recognised the importance of effective tax management practices and stakeholder engagement on tax matters.
“By adhering to tax laws, engaging with tax authorities and continuously improving our tax management processes, we aim to contribute to the sustainable growth of our company and maintain positive relationships with all stakeholders,” Tanganda said.
The firm recently revealed that it had put in place strategies to enhance process efficiencies and manage costs to improve performance.
Tanganda’s revenue declined by 12% to US$4,4 million in the first quarter of the company’s current year ended December 31, 2024, owing to the late onset of rains.
