The Annual Economic Review for the Zambian economy has revealed that for 2018, the total domestic revenue was at K52.8 billion, 8% above the set target of K49.1 billion.
The growth and above budget performance was mainly on account of good performance on value added Tax (VAT). Other tax types were however below projection.
However, the country recorded diminished disbursements of Grants which were below budget target by a whooping 74% at K35.4 million, partly explained by low inflows from some cooperating partners.
The report also indicates that non tax revenue collections which are mostly fees and charges levied by government institutions stood at K8.5 billion, this were above the target by 4.3% which was at K8.2 billon. The favorable performance on non-tax revenues was largely attributed to increased mineral royalty and toll fees collections. This was augmented by enhanced use of direct deposits and use of e-payment system for fees, fines and government services.
Total expenditure including amortization for 2018 stood at K79.2 billion, which was above target by 10.5%. Domestically financed expenditure amounted to K55.4 billion; foreign financed expenditure amounted to K18.3 billion while amortization was K5.5 billion.
Most of the expenditure categories were below target or within programme levels except for interest payment and non-financial assets.
The fiscal deficit on cash basis was 7.6 percent of GDP compared to 7.8 percent in 2017. The outturn was higher than the budget target of 6.1 percent of GDP. Largely on account of higher than programmed project financing.
Meanwhile, preliminary estimates indicate that real GDP growth was at 3.7 percent slightly higher than the growth of 3.5 percent recorded in 2017. The improvement was underpinned by good performance in the mining, electricity, manufacturing and information and communicational sector. Agriculture outputs was however subdued following poor rains during the 2017/2018 farming season.
The performance of non-tax revenue is one area were there is excessive government revenue leakage. Some members of the public have called for automation of fees collection in all government ministries and quasi governmental institutions to ensure that funds do not flow into individual hands of some few corrupt government employees.
Some ministries contribute almost nothing to the treasury yet members of the public are parting away with considerable amounts of monies to “push their files” for various government services. Some institutions have however put up service charters to stem the Vice but this needs a systematic approach for all the different wings of government.
