Axia Challenges US$3m Tax Assessments

 

 

Listed retailer and distribution group Axia Corporation says it is challenging more than US$3 million in tax assessments raised by the Zimbabwe Revenue Authority for different financial periods.

In its audited results for the year ended June 30, 2026, Axia said ZIMRA assessed its business units for an additional US$1.673 million in income tax, penalties and interest for the 2020–2021 period.

The company said the assessments related to taxes it had already settled in Zimbabwe dollars, but which ZIMRA considered should have been paid exclusively in foreign currency.

“The Group was also assessed taxes in circumstances in which it believes it has no lawful tax liabilities,” Axia said.

The company said no credit had been given by ZIMRA for equivalent amounts already paid in local currency.

Axia also disclosed VAT assessments totalling US$1.370 million for 2023–2025, including penalties and fines.

“The penalties and interest relating to income tax have been objected to and challenged with ZIMRA, and no substantial recourse has been found yet,” the company said.

Despite the dispute, Axia said its subsidiaries had paid the full bills under the “pay now, argue later” principle.

The tax assessments contributed to an unusually high effective tax rate and affected profit attributable to shareholders, according to the company.

Axia reported revenue of US$249.546 million for the year, up 27% from the previous year, while profit before tax rose 68% to US$19.392 million.

The company said recent tax reforms, including allowing the deduction of Intermediated Money Transfer Tax when calculating corporate income tax and reducing the IMTT rate on local-currency transactions from 2% to 1.5%, were positive developments.

“This represents a positive step in addressing distortions that have been affecting tax-compliant operators in the formal sector,” Axia said.