The Supreme Court has rejected an appeal by Delta Corporation Limited challenging a High Court ruling. The High Court had ordered the beverage company to pay its taxes in foreign currency.
Zimbabwe’s tax authority, Zimra, had billed Delta in U.S. dollars. Zimra cited the company’s foreign currency revenues and sales as the basis for requiring the foreign currency tax payments.
Delta had contested Zimra’s actions in the courts. The Supreme Court bench, comprised of Deputy Chief Justice Elizabeth Gwaunza, Justice Tendai Uchena, and Justice Samuel Kudya, heard the case.
According to court documents, Delta had been submitting and paying its value-added tax (VAT) returns from March 2019 to October 2021, as well as its income tax returns for 2019 and 2020, entirely in the local currency.
However, on November 17, 2021, Zimra notified Delta of a planned tax review covering January 1, 2019 to October 31, 2021. Zimra questioned whether Delta’s VAT returns were paid in the currency of its sales.
Delta argued that the Finance Act made the local currency the sole legal tender. Nonetheless, Zimra’s tax audit found that Delta had failed to pay income tax and VAT in foreign currency, as required based on its foreign currency revenues.
Zimra then recalculated Delta’s tax liability and issued amended tax returns, demanding the company pay in foreign currency. Dissatisfied, Delta took the matter to the High Court, arguing it was unlawful for Zimra to reject local currency payments.
The High Court sided with Zimra, and Delta subsequently appealed to the Supreme Court. However, the Supreme Court judges upheld the lower court’s decision, dismissing Delta’s appeal and ordering it to pay the associated costs.
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