Friday 17 July 2020


FINANCE minister Mthuli Ncube once again failed to lift the hopes of despondent Zimbabweans when he announced his mid-term budget policy yesterday, the Daily News reports.

 Among other notable omissions, he failed to address how the country should deal with the United States dollar following the growing rejection of the local currency by many shops and other businesses.

 Although Ncube doubled the tax-free threshold for taxpayers — which will see those earning up to $5 000 being exempted from paying tax — his critics said it was “too little too late” as inflation had rendered the gesture meaningless.

“I propose an upward review of the tax-free threshold for workers to $5 000, from $2 000, with effect from August 1 to cushion them, after salaries were eroded by inflation.

“I also propose a tax exemption on risk allowance for public sector health employees working on the frontline in the fight against the Covid-19 pandemic,” the under-fire minister told the National Assembly yesterday.

 In addition, Ncube also announced tax exemptions for the battered tourism sector, as well as firms that had donated more than $100 000 towards Covid-19, as part of efforts to cushion companies from the effects of the deadly virus.

 However, few people were charmed by the minister’s statement, which had been expected to address the country’s two-tier pricing system, following the rebound of the US dollar as the preferred trade currency nationwide.

Former Finance minister in the 2009 stability-inducing government of national unity (GNU), Tendai Biti, said Ncube had “skirted the issues everyone was hoping he would deal with decisively”.

“That was a cowardly presentation because he shied away from confronting the elephant in the room by not acknowledging the fact that the market has rejected the Zimbabwe dollar.
“He also refused to acknowledge that the 2020 budget has been ravaged by inflation, hence there was scope for a supplementary budget — especially in the face of the Covid-19 pandemic,” Biti told the Daily News.

“His cowardice is also reflected by the fact that he realised that a supplementary budget would have entailed that he presents it in real money terms, that is in US dollars — but he shied away from that.

“His statement was dishonest, especially the budget surplus hot air he talks about when health workers are on strike.
“He enjoys listening to his voice and that explains why he continues harping about a non-existent surplus,” Biti further ripped into Ncube.

On its part, the Zimbabwe Congress of Trade Unions (ZCTU) said there were no “positive take-aways” from Ncube’s review statement for suffering workers.

“The tax threshold is meaningless unless he wants it to be enjoyed by domestic and farm workers.
“We expect that the majority of workers earn above that ($5 000) given that the poverty datum line is now at $15 000.

“I don’t understand why he is ignoring the market reality that it has re-dollarised. I am not sure they will win the war because what he has done will not stop workers from striking. 

“He should have addressed the issue around dollarisation,” ZCTU secretary-general, Japhet Moyo, told the Daily News. In a further dose of bad news for long-suffering Zimbabweans, Ncube said economic growth would plunge to minus 4,5 percent this year — compared to his earlier prediction of three percent growth.

He said this was due to the debilitating effects of the Covid-19 pandemic and the drought which had ravaged the sub region. This comes as Zimbabwe is experiencing its worst crisis in a decade, which has stirred anger and restless among its populace. Daily News


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