Zanu PF rants over 2% tax

PRESIDENT Emmerson Mnangagwa’s Zanu PF party has registered disquiet over Finance minister Mthuli Ncube’s 2% tax and the separation of RTGS accounts from nostro foreign currency accounts, blaming the measures, which are yet to be gazetted, for triggering economic chaos in the country.

BY RICHARD CHIDZA

Zanu PF hawks argue that Ncube did not consult adequately on the policies that have forced ordinary citizens into penury overnight although Mnangagwa this week said there was no going back on the measures and urged Zimbabweans to take the pain to correct the economy.

At the heart of Ncube’s challenge is government’s unrestrained spending which saw its domestic debt rising from $275,8 million in 2012 to $9,5 billion currently, in addition to the external debt which stands at $7,4 billion.

The 2% tax is meant to raise funds sat last week.

“Yes that is what I have said. That we were not consulted and we think the current problems are tell-tale signs of teething problems of the new arrangement which Zanu PF is working to resolve.

“I think government is used to coming up with policies after their deliberations which it then pronounces. You will realise that Zanu PF did not have a working system with permanent people, but the situation is different now and we have a functional structure that must be consulted before any policy pronouncement,” Mpofu said.

Regarding the issue of currencies and fears by Zimbabweans that they might lose their savings, Mpofu said indeed the party was worried.

“We were worried, but we have heard that there are interventions including the one from Afreximbank to hedge all balances on a one to one basis with the US dollar,” Mpofu said.

“Government’s economic transition and stabilisation programme is another intervention and we hope to get more information from the minister (Ncube) on his return. We support all interventions to address inflation and related issues.”

Mpofu on Wednesday told journalists at Zanu PF headquarters that “The so-called new financial reforms which have caused price hikes and the response you have seen from business were done without consultations and Zanu PF will not allow that.”


Harare businessman Arnold Mutsondi last week gave government a 14-day ultimatum to reverse the tax or face a Constitutional Court challenge.

Zanu PF spokesperson Simon Khaya Moyo (pictured) said there had been a “communication problem” between the party and government.

“There could have been a lapse in communication, but now there is no conflict. The minister indicated to the nation that the tax will only be implemented after it is gazetted and we are happy with that.

“The party is also happy that there are safeguards to protect the vulnerable through exemptions.

“We expect that government will follow due procedure and exhaust all legal processes before implementation,” Khaya Moyo said.

“The minister has the full support of the party but there must be realisation that the party was supreme.”

Zanu PF chief whip and politburo secretary for youth Pupurai Togarepi said his wing was in support of the austerity measures.

“We are in total support of the austerity measures. There could be short-term shocks as expected in any transformation, but we are certain this will bring a positive net effect to the economy. In any economy you have some unexpected mismatches which will clear in the near future,” Togarepi said.

While reports have claimed Ncube has faced resistance from particularly social services ministers, Information ministry permanent secretary Nick Mangwana said all was well.

“The Minister of Finance has the full support of the whole government. Regarding Zanu PF, please check with the secretary for administration or spokesperson,” Mangwana said.

The Law Society of Zimbabwe (LSZ) early this week added its voice to growing calls against the tax.

“As the law stands, the minister’s directive to all financial institutions, banks and Zimra (Zimbabwe Revenue Authority) working together with telecommunication companies to collect $0,02 per every dollar transacted is unlawful because it violates section 22G of the Finance Act.

“The proper procedure for the amendment of a law (in this instance Section 22G of the Finance Act) is through Parliament as required by the Constitution, and not through a policy statement,” LSZ said.

Vice-President Kembo Mohadi in an address to the media following a Cabinet meeting this week said government was still working on the legal instrument to operationalise the tax.

“Cabinet has equally been briefed about the effects of the two cents per dollar tax on the market. We have also been briefed about the exemptions and government is now seized with fine-tuning the statutory instrument that will operationalise the tax. The two cents on the dollar tax is not yet operational so there is no need to panic,” Mohadi said.

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26 Comments

  1. On the one hand it is desirable for Ncube to be brought to order for his misfire of policy but on the other it’s of no use having a technocratic finance minister if people like Obert Mpofu & his useless zanupf gang hover above him like a watchful eagle & have the final say in decisions. It also exposes ED as a lame duck president without authority over events

    1. ED was seconded and elected to lead the country on a ZANU PF ticket. he is not an independent pres. Its correct for Zanu PF to have a watchfull eye. at the end of day ed failure i zanu pf failure. Clean up your heads. hey

  2. Comment…ED is a lying president who claimed that its nolonger politics as under RGM but its now economics. A leopard cannot change its spots. Since 19 November 2017, Dumbuguru has seen himself as the face of zanu(proved failure) and even refused to appear before a parliamential committee

  3. The coming in of Mpofu and Khaya Moyo is good news to us, They know where the missing 5 billion from January is. They can ditch Ed if milk is no longer oozing.

  4. How can over taxing heavily burdened citizens improve the economy. That is a sign of being clueless by the minister of finance or else he being influenced by the guys like JONSO who want to fix ED.

  5. The moment Obert Mpofu & Khaya Moyo opened their mouths to speak on economics I’m sure any foreign investor who was on his way to Zim panicked & immediately ordered the pilot to make a u-turn in mid air kkkkk

  6. tendai chaminuka

    Saka how many zanus do we have.One yaSimon Khaya inoti we are not for these measures then yaPupurai inoti we support the measures.Zvadhakwa

  7. Give Ncube a chance to work the pains into gains… Mpofu and Moyo know nothing about ecoonomics… mpofu thinks economics is looting diammonds….Moyo & Mpofu..plz close your full mouths for now..we’ve had enough of u..esp u Mpofu, Mr theif.. Moyo is better becoz he only waffles around with a bit clean hands not mpofu the thief…

  8. Cde Obert Mpofu

    There is definitely no going back on Kondozi. Apologies for misfiring…!!

  9. The 2% tax is simply meant to correct the huge fiscal imbalances introduced by g40 in the system before they were deposed and the current government has found a way of correcting them without embarking on any witch hunting exercise which may recover nothing but only a waste of time and effort. It is that commitment which then qualified these guys for the kind of relief our nation got from that African bank which is sponsored by friendly nations including China. Seiko vanhu vakuru muchingoda kuitwa zvekuudza mwana hupedzisira kunge pwere? There are plenty of possible financial sources to help Zimbabwe recover economicaly but we need to demonstrate that we are financialy responsible, and Mthuli and Ed have demonstrated that they can properly handle our fiscus.

    1. finally Farai J Nhire is enlightened…kwete kamba idzo vana Mpofu

    2. @Nhire, there are problems with this tax. Firstly, the percentage is way too high. It should be less than 1% if ever it is imposed. 2% is punitive to say the least. Then secondly, why doesn’t Ncube rein in government expenditure? This is an easy win and anybody can see there are many ways the government can reduce expenditure and direct that money to savings. This is the same govt that chartered a private plane to ferry Grace from a private visit back to Zimbabwe and this is the same government that employs so many people who do nothing but just to please the party. Its not fair to ask too much from people with the govt doing nothing but actually living in luxury.

  10. Comment…I am surprised to hear most people saying they are overtaxed when they only psy VAT. Which other tax do the majority of people pay to central government?? If they are not, munoda kuti hurumende iwanepi mari if the citizens do not want to pay? Let us pay the tax tozopenga kana maservices asina kuimprover.

  11. The problem we have is that ZANU PF does not know where their pocket end and where the govt pocket start. Zvinu zveparty zvinobhadharwa negovt

  12. Iwe isu tinobhadhare P.A.Y.E tozoti VAT then this 2% tax again on every transaction above $10.00 and nekudhura koita zvinhu its every transaction you make. Unogara kupi iwe

  13. there are better ways to do it than to tax the already over burdened citizens.

    1. PutUsInThePicture

      give examples so that we also understand

  14. “We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle”…Winston Churchill

    1. What were the circumstances when that statement was said?

  15. ipai chamisa chimuti.. 2 days tinenge taabhoo…..

  16. Has anyone actually seen documented details of the Afrix loan that underpims our bond notes?
    I don’t think it even exists….

    1:1? Ridiculous!! Govt couldnt even secure its citizens deposits at 5-1 to dollar.

    They have NO money (they lost it all in 2008) and NO-ONE not Afrix, not Chinese not IMF are going to loan them 2 Billion!! Not without conditions that mean Zimbabweans dont run their economy anymore…. Do you think Greece runs its own economy? Ha ha!

    Without 2 billion you cannot fund a new Zimbabwean currency and without that you cannot even DREAM of any sort of economic recovery.

    YOU CANNOT BORROW THAT KIND OF MONEY AND EXPECT TO BE ABLE TO SPEND IT HOW YOU WISH….ESPECIALLY IF YOU HAVE THE SPENDING HISTORY OF ZANUPF. (DEBT AT 9.5 BILLION AND NO THAT IS NOT BOND NOTES IT IS NOT ZIMBABWE DOLLARS IT IS 9.5 BILLION US DOLLARS!!!!

    WAKE UP ZIMBABWEANS!!!!!!

  17. Herbert Mugwagwa

    The new minister[Ncube] has been outside the country for too long and does not know our levels of suffering. We have already been in economic doldrums long he came in. Why should he punish us further with a 2% tax. He must be told the truth: we are some of the highest taxed and most impoverished people in the world. And how could we be indebted to the tune of US$4,5 billion? Where did the money go? It’s such fiscal indiscipline and covert operations that have hemorrhaged the economy not the ordinary Zimbo who faces the full brunt of such actions.

  18. Mr Mafirakureva late me just outline some of the taxes we are paying to the gvt.1)VAT 15% on almost everything we buy on the shelves with a few exceptions on zero rated items and exempt items eg drugs.2)Paye 3)3% Aids Levy 3)Corporate tax 4)15% Withholding tax on financial transactions 4)Royalties accruing to every Zimbabwean 5)Customs taxes 6)Director’s fees taxes 7)Shareholders taxes etc the list is endless.Statistics say that we are one of the most taxed people in Africa actually taxe account to about 30% of our GDP per capita.I think this mthulli is mad because how can you continue to milk the average person who is already poor,the economy cannot grow on those fundamentals.He claims that it applies for transactions of $10 and above and therefore the poor is protected,the question is does it mean that if l transact $20 l am now rich or a person earning $300 per month is rich and must be liable to pay this tax?tha is nonsense.this 2% tax might seem small but it is not at all,there is what we economist call the ‘multiplier’ effect and this going to impact hugely on the economy.

  19. Garanhakakuwonadzevamwe

    Comment…VaMtuli Ncube madiyi kutanga matapudza mari dzinoshandiskwa neHurumende dzakaita seALLOWANCES, SALARIES YEPERM SEC, MINISTERS nevamwe vakuru. Momira zvekutenga mazimotokari. Moita kufamba kushoma. Hamuna kuwonawo here zvakaitwa navaJohn Magufuli nhayi veduwe? Inga zvinonzi kugara nhaka kuwona dzevamwe wani.

  20. Garanhakakuwonadzevamwe

    VaMtuli Ncube madiyi kutanga matapudza mari dzinoshandiskwa neHurumende dzakaita seALLOWANCES, SALARIES YEPERM SEC, MINISTERS nevamwe vakuru. Momira zvekutenga mazimotokari. Moita kufamba kushoma. Hamuna kuwonawo here zvakaitwa navaJohn Magufuli nhayi veduwe? Inga zvinonzi kugara nhaka kuwona dzevamwe wani.

  21. VaMtuli Ncube madiyi kutanga matapudza mari dzinoshandiskwa neHurumende dzakaita seALLOWANCES, SALARIES YEPERM SEC, MINISTERS nevamwe vakuru. Momira zvekutenga mazimotokari. Moita kufamba kushoma. Hamuna kuwonawo here zvakaitwa navaJohn Magufuli nhayi veduwe? Inga zvinonzi kugara nhaka kuwona dzevamwe wani.

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