Zimbabwe Launches New Online Tax System with AfDB Support to Boost Revenues

The initiative was developed under the $10.4 million Tax and Accountability Enhancement Project, with the African Development Bank (AfDB) playing a central role in financing and technical support.

 

The Government of Zimbabwe has officially rolled out its new Tax and Revenue Management System (TaRMS), a landmark reform designed to modernize tax administration, improve efficiency, and strengthen domestic resource mobilization. The system was formally launched on 18 August 2025 in Harare by Deputy Finance Minister Kudakwashe David Mnangagwa, marking the culmination of a reform process that began in 2023.

A Reform Backed by African Development Bank

The initiative was developed under the $10.4 million Tax and Accountability Enhancement Project, with the African Development Bank (AfDB) playing a central role in financing and technical support. The Bank contributed a $7 million grant for the design and development of TaRMS, while the Zimbabwean government funded hardware procurement.

The project also encompassed capacity building and training for internal staff, external users, and stakeholders, as well as comprehensive change management programs to ensure a smooth transition to the digital platform.

Early Impact: Rising Revenues

According to the Zimbabwe Revenue Authority (ZIMRA), the impact of TaRMS has already been significant. Revenue collected from new taxpayers increased by 238 percent in 2024, the first full year after phased rollout, compared to 2023.

Deputy Minister Mnangagwa hailed the reform as a critical step in the government’s broader economic transformation agenda:

“This innovation is a bold step aimed at enhancing revenue mobilization, improving taxpayer experience, and building a strong foundation for sustainable growth.”

Building Trust and Transparency

At the launch event, ZIMRA Board Chairperson Anthony Mandiwanza emphasized TaRMS’s role in reshaping the relationship between taxpayers and the Authority:

“TaRMS is fundamentally a nation-building instrument. It is a bridge connecting taxpayers and the Authority, cementing trust, transparency, and efficiency, while firmly aligning ZIMRA with the aspirations of Vision 2030.”

The system is expected to streamline compliance by reducing paperwork, offering faster services, and setting clearer rules for businesses, thereby widening the tax base while minimizing leakages.

Addressing Africa’s Revenue Challenges

Kelvin Banda, Officer-in-Charge of the AfDB’s Zimbabwe country office, framed the reform within the broader African context of fiscal pressures and limited donor funding:

“With dwindling development assistance and donor funding, as well as increased difficulties in accessing external loans, increased domestic resource mobilization is an essential policy mechanism to assist African countries in addressing their specific development challenges. This launch is a landmark milestone not only for the Government of Zimbabwe and ZIMRA, but also for the African Development Bank.”

Across the continent, public revenues remain weak. Africa’s average tax-to-GDP ratio has stagnated below 15 percent in more than half of its countries, far behind other regions. The AfDB estimates that to close Africa’s annual financing gap of $402.2 billion—required to meet the Sustainable Development Goals (SDGs) and the African Union’s Agenda 2063—the median tax-to-GDP ratio must rise from the current 14 percent to at least 27.2 percent.

A Digital Future for Revenue Administration

The introduction of TaRMS is expected to:

• Reduce opportunities for corruption and leakages.

• Widen the tax base by capturing previously unregistered taxpayers.

• Improve taxpayer compliance through simpler, digital processes.

• Support business growth by reducing administrative burdens.

The system aligns with Zimbabwe’s long-term economic reform agenda and the AfDB’s strategy to promote digitization of public finance systems as a means to strengthen governance and fiscal resilience.

Looking Ahead

With TaRMS now fully operational, Zimbabwe joins a growing list of African nations investing in digital tax reforms to enhance fiscal sustainability. For Zimbabwe, where access to external financing remains limited, mobilizing domestic resources will be crucial to funding infrastructure, healthcare, and social programs.

The launch not only represents a milestone in Zimbabwe’s economic reform journey, but also serves as an example for other African countries seeking to modernize tax systems, build transparency, and achieve sustainable development.