PHD Denies Tax Evasion Charge, Claims $28 Million Sales Were Donations

Walter Magaya’s Prophetic Healing and Deliverance, (PHD) Ministries has denied allegations of tax evasion saying that all what the church realized in selling anointing oil and other stuff were donations from the church members.

The church is being prosecuted for failing to pay tax to the Zimbabwe Revenue Authority ( Zimra), after investigations proved that PHD Ministries made millions from selling church products including anointing oil, t-shirts, wrist bands and other products in the name of “anointing” from the “prophet”.

In its defense read to the court, Admire Rubaya and Everson Chatambudza on the instruction, said all the money which the state is alleging the church raised was all from the donations and that the goods are exempted from tax.

“The accused only received donations, tithes, offerings and contributions from its members and other allegations that it failed to withhold employees tax for Tendai Magaya, the wife to Magaya and Magaya’s alleged remuneration in the total sum of $954 522.99 and $2 403 658.24 respectively,” he said.

However, Tinashe Madakadze the chief investing officer at Zimra crushed the defense saying that PHD is a tax payer according to his investigations.

He told the court in his testimony that Magaya’s church was registered with Zimra as a tax payer on 20 October 2014.

He also said that during the registration, PHD Ministries said that they were involved in selling various products printed the church name and that in the Value Added Tax form they signed on 26 February 2016 it shows that they are selling taxable goods.

The state alleges that PHD Ministries raises revenue from selling church regalia, anointing oil and holy water as well as operating a guest house at Yadah hotel.

It is the state’s cases that sometime in October 2018, Zimra conducted tax investigations and recovered financial statements from PHD Ministries extending from 2013 to 2017.

Financial statements were also recovered from the Commercial Bank of Zimbabwe (CBZ) which were submitted by the accused for a loan application.

The statements showed that PHD Ministries had realized sales amounting to US$28 706 040 million during the period 2013 to 2017, and during that period, the accused did not submit income tax returns to Zimra.

On the second count, during the same period it is alleged that the accused paid remuneration amounting to US $950 522.99 to Tendai Magaya through bank transfer into her personal Stanbic Bank account.

PHD also transferred remuneration of US $2 403 658.24 to Walter Magaya’s Stanibic Bank account on both occasions PHD evaded tax by not paying PAYE (pay as you earn ).

It is alleged that PHD had no records of all goods and services, that is sales and purchases, which is a violation of VAT.

It was discovered that on VAT returns for the said period, PHD failed to declare the exports he made and had submitted VAT returns with false entries again violating the VAT Act.

Source : 263Chat

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