WEALTH TAX SHELVED

The Government has temporarily shelved implementation of the wealth tax pending the completion of administrative and legislative refinements, Finance, Economic Development and Investment Promotion Deputy Minister Kudakwashe Mnangagwa has said.

The tax, which was introduced to compel high-net-worth individuals to contribute more towards the fiscus, was expected to widen Zimbabwe’s revenue base and address wealth inequalities.

However, Deputy Minister Mnangagwa told the National Assembly during Wednesday’s question-and-answer session that collection had not yet started.

“Since the introduction of legislation requiring selected wealthy individuals to contribute to the fiscus through a wealth tax, our Government temporarily shelved the implementation thereof, pending conclusion of requisite administrative modalities informed by the concerns raised by some stakeholders,” he said.

The tax, he added, could only be enforced once clear mechanisms were in place to assess, monitor and collect contributions from targeted individuals and entities.

“The additional administrative modalities and legislative amendments thereof will thus be tabled before Parliament for approval, paving way for implementation of the tax.

“Revenue collection will thus commence after the refinement of the implementation modalities.”

Wealth taxes are levies charged on the market value of assets owned by individuals or households, including real estate, shares and investments.

Globally, they are often used to reduce income and wealth disparities while providing additional funding for social services, infrastructure and other public programmes.

Zimbabwe’s wealth tax was unveiled as part of wide-ranging fiscal reforms aimed at expanding the country’s revenue streams beyond traditional income and consumption taxes.

Treasury argues that the tax would ensure that the country’s richest citizens make a fairer contribution towards national development.

But concerns were raised over how the tax would be administered.

Experts questioned whether the Zimbabwe Revenue Authority has the capacity to properly identify and evaluate wealth holdings, warning that loopholes could undermine both compliance and revenue targets.

Emakhandeni-Luveve Member of Parliament Collins Bajila quizzed Deputy Minister Mnangagwa on whether the Government would consider repealing the measure altogether, given that no revenue had been realised so far.

However, the Deputy Minister indicated that repealing the law was unnecessary and would only prolong the process.

“We have temporarily shelved it until the administrative modalities have been sorted out and figured out,” he said.

“The honourable member (Bajila) would have us repeal the legislation and then bring it back again before this august House. I would think that amendments would still need to come before this same House. It is a matter of process . . . but the intention is the same.”

He said once consultations are completed and Parliament has approved the required changes, the tax would be enforced. Sunday Mail

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