HomeLocal NewsBlaming whipping system a convenient excuse by less committed MPs

Blaming whipping system a convenient excuse by less committed MPs


The Budget, Finance and Investment Promotion Portfolio Committee of Parliament this week managed to influence significant changes to the New Income Tax draft law, thanks to public hearings convened by the committee to receive citizen input on this important piece of legislation.

Report by John Makamure

The committee had resolved to block parliamentary approval of the New Income Tax Bill following a huge public outcry against some of the draft legislation’s provisions. The Minister of Finance then met with the Budget Committee on Monday and agreed to take on board 80 % of the 15 recommendations from the committee.

This development is being viewed as very significant in the history of the 7th Parliament (whose life comes to an end on June 29) in that the legislative branch has largely existed to rubber-stamp Executive decisions. Apart from the Electoral Amendment Bill and Human Rights Commission Bill, most of the Bills introduced during the life of the 7th Parliament were passed without any significant amendments as parliamentarians are whipped into line by a much stronger Executive.

This largely explains why Parliament has not been effective in the enactment of appropriate legislation to ensure the implementation of necessary reforms for the conduct of free and fair elections in Zimbabwe.

The Budget Committee conducted public hearings in Harare, Mutare, Masvingo and Bulawayo last week to solicit citizens’ views on the draft legislation after it was introduced in Parliament the previous week.

Participants at the hearings all spoke strongly against the Bill, arguing that it penalised the already overburdened individual and corporate taxpayer. The negative impact on investment prospects was too ghastly to contemplate, according to the Confederation of Zimbabwe Industries, the country’s largest industrial body. The Zimbabwe Congress of Trade Unions, Zimbabwe’s umbrella labour body, described the Bill as a “regressive” piece of legislation that worsens the plight of workers struggling to survive the harsh economic environment.

Others accused government of trying to raise funding for the elections through imposing additional taxes on the consumer. Over
$100 million is required for the electoral process. A begging bowel has been extended to Sadc, which is going to convene a special summit on June 9 to deal with the issue of funding, among other issues related to the Global Political Agreemtn and roadmap for elections in Zimbabwe. The Constitutional Court ruled last Friday that elections must be conducted by 31 July, a deadline several political analysts have described as “unrealistic” given numerous legal and political processes that have to unfold before the polls.

The New Income Tax Bill seeks to repeal and replace the Income Tax Act (Chapter 23:06), which was first enacted in 1967. One of the key provisions that had caused huge public outcry was the shift from source-based income taxation to a residence-based one whereby the taxable income of a Zimbabwean resident is the taxpayer’s income within and outside Zimbabwe. This meant income earned by Zimbabweans in the Diaspora would have been taxed. The Minister agreed to the committee’s recommendation not to tax income received from the Diaspora. The current complicated definition of a resident will be clarified in the revised draft legislation.

The Minister also agreed to simplify the taxation on motor vehicle benefits by reverting to the previous system whereby the rates are determined on engine capacity. The proposed taxation on subsistence allowances was viewed by the committee as counter-productive in that it posed a number of challenges such as increasing costs to the already struggling employer in the event that employees decided to stay in hotels. The maximum deductable allowance for motor vehicles set at a value of $10 000 encouraged the use of second-hand and unsafe motor vehicles which were the only vehicles that fell under this value. The Minister agreed to review these provisions.

In terms of dispute resolution, the Bill sought to empower a Zimbabwe Revenue Authority official to make the final determination. The committee recommended that the Minister incorporate an alternative tax dispute resolution mechanism. He then agreed to establish a fiscal appeals authority.

The public and the business community felt penalties on failure to pay tax on time were extremely high on minor infringements, even if that taxpayer had previously paid their taxes. In addition, some companies failed to pay tax due to non-payment by Government and parastatals. The Minister agreed to review the penalties regime.

It is my hope that the successes scored by the Budget Committee should provide a good lesson to other portfolio committees that Parliament can still make law (its primary function) provided the committee is well-organised and properly led and makes submissions backed by public input. Always blaming the whipping system for failure to effect changes to draft legislation and policy is sometimes a convenient excuse by less committed Members of Parliament.

lJohn Makamure is the Executive Director of the Southern African Parliamentary Support Trust writing in his personal capacity. Feedback: john.makamure@gmail.com

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