Is it legal to empty people’s bank accounts?
This week, I want to introduce you to Mr Banda, a totally fictitious businessman, who happens to be a law-abiding citizen, and is therefore paying his taxes. However, one day, the Zambia Revenue Authority (ZRA) informs Mr Banda that he owes a totally fictitious amount of K21,700 in unpaid taxes and penalties.
The onus is now on Mr Banda to prove that he does not owe this amount, and please remember that Zambia’s rather user-unfriendly tax system means that mistakes happen all the time, sometimes as a fault of the taxpayer, but certainly also as a fault of the ZRA.
However, the ZRA does not wait for Mr Banda’s evidence. Instead, it sends out a request to every bank in Zambia, asking if they happens to hold Mr Banda’s bank account, and if they do, to please transfer what is in the account up to the amount of K21,700 to ZRA with immediate effect, within that same day.
When Mr Banda finds out that his account has been drained, he is obviously rather upset, and rushes to ZRA. However, not even the evidence that Mr Banda does not owe the ZRA any tax will compel ZRA to return Mr Banda’s money. Instead, the confiscated amount will simply be offset against future tax payments.
Now, this is a totally fictitious tale, but something similar happened to a friend of mine, and it has been confirmed by the banks. This week, ZRA’s new commissioner general Kingsley Chanda declared war on tax evasion, explaining that the ZRA would “mount an aggressive nationwide tax collection crusade”. I hope this does not involve cleaning out people’s bank accounts without their knowledge. After all, one wonders whether it is legal to do this over a disputed amount? What happened to the fundamental concept of innocent until proven guilty?
Camilla Hebo Buus, Editor Zambia Weekly