By Harry Taruva
The Zimbabwe government has unveiled a raft of measures aimed at stabilising the economy and bring sanity to the financial sector.
In a press statement Finance Minister Professor Ncube said
” Treasury will now fund the Zimbabwe dollar component of the 25% foreign currency surrendered by exporters in order to eliminate the creation of additional money supply..banks will no longer withhold any foreign currency surrendered by exporters and all the liabilities to the banks will be settled through Treasury…”
In addition Mthuli said government would
1)introduce a 1% tax on all foreign payments,
2)maintain the USD cash withdrawal tax at 2%,
3)implement through Fidelity Gold refinery a system to manage traceability of gold from its origin ,both commercial and small scale inline with international standards.
4) Ensure all excise duty for fuel will now be paid for in foreign currency.
Inorder to encourage people to bank money, the Minister said the government would:
1)reduce the local interbank IMT tax to 1%
2)reduce POS IMT tax in foreign currency to 1%
With the rising inflation,the public has become more hesitant to use the local currency with parallel market rates going over 4000: 1 usd.
To mitigate this and encourage use of local currency,the Finance Minister revealed that government would
1) Direct its agencies including parastatals to accept local currency when collecting their fees.
2)Ensure that payments to Zesa by non exporters be made in the local currency.
3)Direct that all customs duty be payable in local currency except designated luxury goods or where a customer opts to pay in foreign currency.
Other important pronouncements by Mthuli include,
1)government taking over all foreign currency debts from the Reserve Bank of Zimbabwe on 1 june 2023.
2)Creation of a debt redemption fund to service all external liabilities inline with the debt clearance program.These will be funded through new levies and other resource mobilisation measures.
On the foreign currency auction scheme,Mthuli said government would
1)limit the weekly figure to $5million
2)make sure all winning bids are paid within 24 hours of award while exporters selling goods like cement,soft drinks, milk etc will now be required to chsrge VAT which will be refundable by ZIMRA after exporting.
With regards to externalisation of funds, Mthuli said government would strengthen surveillance and monitoring complemented by a robust foreign currency payment system and information sharing platform between financial institutions and ZIMRA.
With the adoption of these measures, government reiterated commitment to the maintenance of macroeconomic stability, preservation of the purchasing power of the Zimbabwe dollar and the restoration of trust and confidence in the Zimbabwe economy.
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