IN a move purportedly designed to curb the flight of capital from formal banking channels to the informal economy, Finance minister Mthuli Ncube proposed to introduce a cash withdrawal levy in his 2026 national budget.
The policy, however, has sparked widespread criticism from economists and business leaders, who argue it increases transactional costs and actively undermines the very goal of a formalised, transparent financial system.
The government’s defence, however, has served only to highlight the profound hypocrisy at its core and to ignite public fury over a system that appears to have one rule for the ordinary citizen and another for the politically-connected.
Recently, at a Harare business meeting, permanent secretary for Finance George Guvamatanga illustrated this disconnect with stunning clarity. Challenging the need for cash, he rhetorically asked: “As a corporate, why would you want to withdraw US$5 000 in cash?”
What is ridiculous is that the same government that questions a corporation’s need for US$5 000 never dares to ask why Zanu PF elites require US$100 000 in crisp bills.
There is no inquiry into how figures such as businessman Kudakwashe Tagwirei, presidential advisor Paul Tungwarara, or the flamboyant Wicknell Chivayo procure vast bricks of cash for their very public distributions.
Most conspicuously, no one questions the source of the cash routinely doled out by President Emmerson Mnangagwa himself in carefully-staged political philanthropy.
This spectacle raises urgent, legitimate questions that Guvamatanga’s logic cannot answer: Where is this cash coming from in an economy with strict withdrawal limits? What mysterious, parallel financial pipeline exists for the powerful?
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Most damningly, what stops these elites from using digital transfers if their wealth is legitimate and their intentions purely charitable? The answer, evident to all, is that cash is the lifeblood of opacity.
It is untraceable, unaccountable and essential for maintaining patronage networks, masking corruption and consolidating power through literal hand-outs.
Thus, Guvamatanga’s question backfires spectacularly. It is not a query about sound economics, but a stark revelation of a two-tiered system. The corporate entity withdrawing US$5 000 for payroll or supplies faces a levy and interrogation. The political operative moving US$100 000 for undisclosed purposes operates with impunity.
This selective application of financial discipline is not merely unfair; it is a fundamental rot at the heart of economic governance. It tells every citizen that formalisation is a trap for the governed, not a principle for the governors.
Until the state can demonstrate that its financial laws apply equally to the powerful in Zanu PF’s inner circle, no amount of levies will stop the flight to cash.
They will only prove that the informal sector is, for most, a rational sanctuary from a formal system that is itself predatory, irrational, and rotten to the core.
