Green Party writes Minister of Finance to place a waiver on income withholding tax on residential rent
Green Party President Peter Sinkamba has written to the Minister of Finance Margret Mwanakatwe demanding immediate issue of a waiver to formally exempt individuals who own residential properties from paying withholding tax on rental income. He said that the waiver should hold until an equitable system is put in place to ensure poor and unemployed landlords are unduly exploited by Government.
Mr. Sinkamba disclosed this in Kitwe this morning following the lapse of the deadline set by Zambia Revenue Authority (ZRA) Commissioner General Kingsley Chanda requiring all landlords and tenants to register for withholding tax by 1st March. He said it is improper for government to issue ultimatums before amicably resolving the Pay As You Earn (PAYE) issues.
“For example, the Income Tax Act provides for a system of taxing emoluments. The word ‘emoluments’ is quite extravagant. According to Section 2 of the Income Tax Act, it includes wages, salaries, overtime, leave pay, commissions, fees, bonuses, gratuities and any other payments from employment or office. For some unemployed or retired township dwellers, renting of servants’ quarters or part or whole house is their office. Some are orphans, others are widows whose only source of income are those quarters or parts of houses or indeed whole houses. So, to them, the houses is their employment and their office. How then do you go ahead to give deadlines without resolving these pertinent issues?” said Mr. Sinkamba.
Mr. Sinkamba explained that according to Section 45 of the Income Tax Act, an income of K3, 300 gross per month is not reportable income. He said that such an income is tax free and added that beneficiaries are obliged by law to report that income to ZRA. He said the tax free provision does not only apply to those who earn income through formal employment but even those who earn their income through informal means. He said the rebate should also extend to landlords who charge rental which is equivalent or below the taxable threshold.
“The Income Tax Act provides a tax rebate for persons who earn gross revenue of K3,300.00 per month. Most, if not all landlords in Chimwemwe, Wusakili, Kanyama, Mandevu and elsewhere in the countrywide do not earn that kind of money from rent charges. Almost 98% of households countrywide are not worth that kind of money in rental charges per month. So, why bother God’s people to register, and give them deadlines, when you know for fact that they are statutorily exempt from reporting their earnings to ZRA? It is like ukukumbwa nefyo tabalya,” he quipped.
“Zambia is a constitutional democracy. It must be governed according to the National Value and Principles which the President talked about last week on Friday. Some of the values and principles include human dignity, equity, social justice, equality and nondiscrimination, good governance and integrity. The threats by ZRA are nowhere closer to these values and principles. ZRA has unduly sent serious shivers in our people in compounds. What makes matters worse is that the vast majority of our people are extremely vulnerable because they cannot afford legal representation if ZRA were to pounce on them.
“You see, Government is a making of the people. Leaders are elected into government by the people, to serve the people, and not to exploit, intimidate or bother them for nothing. Therefore, when leaders are privileged, by the people, to serve in government, then the leaders in return have an onerous responsibility to act responsibly towards people’s interests and complaints. Sadly, and shockingly so, our colleagues in the PF Government have drifted away from National Values and Principle enshrined in the Constitution,” the Green Party leaders grieved.
“This issue of withholding tax requires a sober approach by our colleagues in Government not threatening the people. Those in Government must always remember that according to our constitution, ultimately sovereign authority is vested in the people. They must always remember that the power has just been temporarily lent to them on borrowed time for that matter. It is therefore improper and an exhibition of serious irresponsibility to threaten the people simply because they are poor, illiterate, and hopeless.
“The deadline set by ZRA lapsed two week ago. Our people do not know what will follow next. The threats and ultimatums by ZRA have really sent serious shivers in our people, especially those in compounds. These people are extremely vulnerable because they cannot afford legal representation if ZRA pounces on them. So to avoid their misery, just in case ZRA decides to be brutal, as the Green Party, we have decided to write the Minister of Finance to immediately place a waiver on rent income withholding tax until an equitable system is put in place to ensure that poor and unemployed landlords are unduly exploited by Government. We hope she takes this request seriously and with the urgency it deserves”
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