Finance and Economic Development Minister, Patrick Chinamasa

IT is an open secret that government is in financial dire straits. Two months into 2017, it is still grappling with the issue of civil servants bonus payments for last year, and is battling to mobilise resources to meet its commitments.
This year, there is a possibility that the civil servants may clearly fail to get the 2016 bonus payments due to government’s financial circumstances.
Yet the pressure, as we have become well accustomed to government’s tendency, is that they may desperately scour every possible avenue to ensure they placate the 550 000-strong civil service ahead of critical elections in 2018.
The recent introduction of a 15 percent value added tax (VAT) by Finance and Economic Development Minister, Patrick Chinamasa, on meats and cereals may be one desperate way by government to ensure it gets the suffering public to fund its depleted coffers, and possibly raise money to pay civil servants.
The 15 percent VAT on meats and cereals is among a plethora of recent taxes imposed by government to stabilise its precarious financial position. In all instances, the taxes have had little or no regard to the impact on the poor, who now constitute the majority of Zimbabweans due to increasing joblessness caused by company closures.
Parliamentarian, Irene Zindi, of the ruling ZANU-PF, indicated during debate last week that the new tax would punish the poor because “most of the families (in Zimbabwe) will not be able to have food on their table because it will be too expensive”.
Unemployment in Zimbabwe is estimated at over 90 percent. The majority of Zimbabwe’s working population are earning salaries below the poverty datum line — the minimum level of income needed to secure the necessities of life.
A World Food Programme report indicates that 72 percent of the population lives below the national poverty line (living on less than US$1,25 per day).
The new tax will, therefore, erode the incomes of the majority of our population, further condemning them to abject poverty.
It is conceivable that the majority of working people’s incomes are going towards tax in one form or another.
We believe that increasing tax on an already over-burdened taxpayer demonstrates blatant disregard for the welfare of the majority of Zimbabweans. There is no doubt that there is widespread profligacy in government and Chinamasa should ensure that government lives within its means.
This is possible; we witnessed the success of such a budgetary regime during the inclusive government, when former finance minister, Tendai Biti, insisted that government would not spend outside available resources.
Last year, government incurred a budget deficit of about US$1 billion, against an initial projection of US$150 million.
We fear the worst this year. But Chinamasa should be clever to know that the people he is punishing today are the very same people the ruling party will seek to woo for votes in 2018.