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Zambia Revenue Authority. ZERO TOLERANCE ON CORRUPTION 27 th CATA Technical Conference-2006 Mauritius By Wisdom Nhekairo – Commissioner – Direct Taxes Zambia Revenue Authority. Introduction.
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Zambia Revenue Authority ZERO TOLERANCE ON CORRUPTION 27th CATA Technical Conference-2006 Mauritius By Wisdom Nhekairo – Commissioner – Direct Taxes Zambia Revenue Authority.
Introduction • Corruption has become an issue of major political and economic significance in recent years and the necessity to take measures against it has become evident. It takes different forms but in tax administration it manifestly leads to tax evasion amongst other vices, resulting in reduced revenue collections.
What is corruption? • According to the ‘Concise Oxford Dictionary, 9th Edition’, corruption is defined as “moral decay influenced by bribery or fraudulent activity”. • The Transparency International Corruption index defines corruption as the abuse of public office for private gain, and measures the degree to which corruption is perceived to exist among a country's public officials and politicians.
What is the Impact of Corruption? • The World Bank has identified corruption as among the greatest obstacles to economic and social development. It undermines development by distorting the rule of law and weakening the institutional foundation on which economic growth depends. • Corruption leads to a high cost of development.
Impactof Corruption Contd. • Reduced revenue collection resulting from - • Low compliance as a result of loss of confidence in revenue agency • Low motivation by members of staff • Breeds unfair competition amongst business entities negatively affecting the consumers.
Effort To Deal With Scourge at International Level • International Conventions developed to combat corruption such as the United Nations Convention against Corruption (UNAC) and the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions – are of key importance in the fight on zero tolerance against corruption. • These texts, agreed by governments, recognise corruption as a worldwide and cross-border affliction, and express a shared high-level political commitment to addressing this critical problem individually and collectively.
Effort To Deal With Scourge at the International Level • Each text establishes an international, regional or sub-regional framework of rules and standards, some of them binding, that promote domestic action and facilitate international cooperation. • TheWorld Bank has since 1996, supported more than 600 anticorruption programs and governance initiatives developed by its member countries. • As corruption sabotages policies and programs that aim to reduce poverty, attacking corruption is critical to the achievement of the Bank's overarching mission of poverty reduction.
Efforts to Deal with the Scourge at National Level • Executive support towards this fight has been positive as the President of Zambia stated in his opening speech to the National Assembly when he declared the intention of government to combat corruption. • “In the spirit of good governance, the new deal administration has continued to pursue the policy of zero tolerance to corruption with a view to getting rid of corrupt practices in society.”
Effort To Deal With Scourge at National Level (contd.) • Legislation enacted and national corruption prevention policy and strategy developed to combat corruption. • Creation of institutions to prevent and fight corruption such as the Task Force on Corruption, Anti-Corruption Commission and the Anti- Money Laundering Unit. • Technical support has been sourced in conjunction with donor support to strengthen institutional capacity to deal with corruption. • Increased public awareness programmes on the fight against corruption undertaken.
Effort To Deal With Scourge at Institutional Level • The Zambia Revenue Authority (ZRA) has put in place an Internal Affairs Unit, whose object is to investigate all matters pertaining to corruption involving employees. • All employees are mandated to declare assets and interests on an annual basis so as to maintain integrity within the organisation. • Further a taxpayer’s charter is in place to which all officers of the ZRA are obliged to abide.
Challenges of dealing with Corruption • Culture of corruption in a given society • Weak internal controls and enforcement capability within public institutions. • Inadequate funding of a revenue agency leads to vulnerability of the organisation and its officers. • Poverty Levels within the general populace • Bureaucratic procedures in public institutions • Other Social factors
Culture of Corruption • Indifference to corruption • Offering and soliciting of bribes • Tolerance of corrupt practices
Weak Controls • Weak or non-existence of controls tend to perpetuate corrupt practices amongst officers. • Lack of enforcement capability of agencies that are empowered to deal with corrupt practices.
Inadequate Funding • Leads to poorly remunerated staff who are prone to corruption (an antidote to the very reason of creating independent revenue agencies). • Reduced resources to monitor and enforce integrity
High Poverty Levels • High poverty levels in a given society also leads to the perpetration of corrupt practices as the taxpaying community are financially challenged to meet their obligations and as such will tend to seek means that will reduce their financial obligations using corrupt practices.
Bureaucratic Procedures • The existence of bureaucratic processes tend to create an environment conducive for corruption as taxpayers will attempt to circumvent such procedures by offering bribes to revenue officers.
SOCIAL FACTORS • Low literacy levels in a society • Inadequate provision of social facilities • Poor service delivery to the citizenry
MEASURES TO MINIMISE INCIDENCE OF CORRUPTION • Acknowledgement of the existence of corruption. • Develop and put in place appropriate strategies, policies and legislation. • Promotion of awareness of evils of corruption • Enforcement of anti-corruption laws. • Ensure adequate funding to revenue agencies • Efficient and equitable provision of social services.
CONCLUSION Corruption is real and there is need to minimise its incidence. All efforts must be targeted at its eradication with the utmost energies and resources. Thank you, all.
