“‘Pay now, argue later’: a legal analysis of the observance of taxpayers’ rights in Zimbabwe”

Abstract

This study seeks to critically examine the powers given to the Zimbabwe Revenue Authority (herein referred to as ‘ZIMRA’) in terms of the ‘pay now, argue latter’ principle vis-à-vis the taxpayers’ rights entrenched in the Constitution of Zimbabwe. This dissertation examines the nature and content of the ‘pay now, argue later’ rule in terms of section 36 of the Value Added Tax Act and Section 69 of the Income Tax Act vis-à-vis the taxpayer’s right to access the court as guaranteed in section 69 of the Constitution of Zimbabwe. The study further makes a comparative analysis with South Africa. This study establishes that the ‘pay now, argue later’ rule prima facie infringes the taxpayers right to access of courts and justice as the rule obliges the taxpayer to pay the amount of tax assessed prior to the full airing of the issue before a court of law. The rule prevents the affected taxpayer from obtaining interlocutory relief to suspend the obligation to pay the tax assessed to be due and payable. However, this study concludes that the ‘pay now, argue later’ serves the fundamental public purpose of ensuring that the fiscus is not prejudiced by delay in obtaining finality in any tax dispute therefore it constitutes a justifiable limitation of the right to access the court. Be that as it may, the writer is of the view that section 36 of the VAT Act and section 69 of the Income Tax Act need to be reformed. The fact that the said provisions do not provide guidelines on how the Commissioner must exercise his or her discretion leaves a lot to be desired.