THE Zimbabwe Coalition on Debt and Development (Zimcodd) has attacked the government’s recent unilateral increase of duty on fuel in the country where the ordinary person is heavily taxed while the economy is also on a free fall.
Zimcodd, an economic justice civil society, said the new taxes on fuel had the negative effect of eroding any gains due to the consumers arising from the declining petroleum prices on the world market.
Government last week ordered the reduction of petrol price from $1,52 to $1,44 and diesel to $1,32 from $1,44, but simultaneously raised duty on fuel by $0,10 per litre.
“The government should have progressive taxation policies that benefit ordinary citizens in addition to wider and inclusive consultations with various stakeholders in matters that affect citizens remain critical in policy processes,” Zimcodd said.
It noted that in the fuel duty case, there was insufficient consultation before a decision to increase duty was made.
It added: “If that was the case that government consulted with industry, then the question is, do consultations between government and industry suffice to represent the voices of all Zimbabweans? Zimcodd feels that wider consultations should have been done with various stakeholders taking into account the consumers’ voices.”
After the cosmetic changes in fuel prices, Zimcodd argued that Zimbabwean fuel remained highly priced as compared to other countries in the region.
Zimcodd added that the continued high fuel prices would slow down economic growth and further stress the highly-taxed population. “The development affects the final consumers, who are already heavily taxed, to whom the fuel importers pass on the tax burden. Fuel prices have a bearing on commodity prices and the economic performance in general,” it said.
“Policy inconsistencies need to be addressed to avoid inconveniences to industry and final consumers and to that end the government should align its policies in response to positive regional and global trends.”