The Sunday News
FINANCE and Economic Development Minister Patrick Chinamasa must be ranked among those with the most difficult jobs in this country.
I do not know how many requests for money he receives from his colleagues and various Government departments on a daily basis. The demands are growing but it is no secret that the coffers are not proportionally growing to meet those demands.
So sad is Minister Chinamasa’s situation that even some of his colleagues are now hiding their incompetency in superintending their departments, by pointing a finger at the Treasury. One of the most common excuses almost every Government department is turning to these days is that it is not receiving enough funding from Minister Chinamasa’s ministry.
This could be true because some of the figures that are thrown around are just too little to even think they can bring the change needed from these ministries. First, ministries are allocated money in the National Budget which is not enough. As if that is not all, even the paltry allocated money rarely finds its way to these departments as most ministries complain that they would have not received the allocations. In simple terms, this is like a company which cuts its workers’ salaries by half and even after that only manages to pay a quarter of that half. It is very painful.
On Wednesday, Minister Chinamasa admitted that he had made an “error” when he reduced the budgetary allocation to State universities in the 2017 budget. I am sure other ministries and departments are queuing at the minister’s office pointing to other “errors” he made when he made the budget estimates for this year. Other sectors and ministries were also allocated reduced funding and this is exactly what happened even with State universities. The only advantage is that this “error” has been addressed.
It is common practice the world over that when governments are facing financial constraints they in turn come up with measures to raise the required money. One of the most common avenues governments turn to is to raise taxes or rather introduce new ones. This is exactly what Minister Chinamasa has done. He has come up with a Statutory Instrument (SI) 20 of 2017 which imposes a 15 percent Value Added Tax on meat products and cereals.
According to a notice from the Zimbabwe Revenue Authority, some of the goods that will attract the tax are potatoes, rice, margarine, mahewu, meat including edible offals of cattle, sheep, swine, goats, horses, asses, mules or hinnies. Even the once popular isagwaca/zvihuta is part of the products because they are classified as poultry. The list includes fish whether dried, smoked or fresh. The list also encompasses cereals. In short the list targets all the basic goods most households in Zimbabwe consume on a daily basis. The net effect is that retailers will increase the prices of these goods. In fact, the prices have already gone up.
Even those businesses that revolve around these products have taken advantage and also increased their prices. Word was that some restaurants have already increased their meal prices, not by the 15 percent but by as much as 50 percent.
This is exactly where the trick is. As much as the Government needs money, there is a need to consider the effects such decisions will have on the ordinary person. The same people who are now faced with a new price increase are the same people who are struggling to make ends meet. In 2015, more than 20 000 employees lost their jobs in a few months after a Supreme Court ruling which gave employers the right to fire workers on a three month notice with paltry packages. Since then more companies have been firing their workers too. And all this points to dwindling sources of income for many families. Did Minister Chinamasa think about all these people who are struggling to make ends meet?
Did he think about his own workers (civil servants) who he has not paid bonuses and whose pay has remained stagnant since 2014? These are the same people who will be affected by this latest SI. These are the poor workers and vendors who will need to buy even offals and kapenta to ensure that they have something to eat daily.
Even if it is justified to introduce VAT on these goods, is 15 percent not too much for the majority of people who are already facing such challenges? There are so many other goods and services which Minister Chinamasa could have targeted without hitting the pockets of the ordinary poor people. Remember these people are already paying many other taxes. If they are workers they are paying PAYE, NSSA, Aids Levy and all the related taxes they face when they are buying from the shops.
These are the same poor people who are paying tollgates, carbon tax (if you are driving and in Zimbabwe driving is not necessarily for the rich people).
Those who are into selling are importing goods and they are meant to pay all those various forms of duty at border posts.
Almost everyone is paying something already and the difference is only on what business or work you are into.
Minister Chinamasa should have looked for other avenues to raise the money. He once proposed to target churches and I think this was a good idea. I am a Christian too but the commercialisation of churches these days surely should attract the taxman.
The good about churches is that most of the monies we pay, we do that voluntarily and even if it is taxed then it does not look like we are being forced. It is unlike foodstuffs which everyone has to consume whether you have money or not.
I am sure with all the technocrats in his ministry, there are a lot of other avenues that Government could think of of raising the much needed money without punching too much in the face of an already burdened person who is struggling to remain standing.
