By Paidamoyo Muzulu
Africa-Press – Zimbabwe. MANY Zimbabweans this week woke up to the good news, the Finance ministry had streamlined the number of taxes business and individuals pay to get certain services.
But something is amiss.
These tax reductions just spring from nowhere and are silent on how the revenue gap will be plugged.
It happened a few days after the revenue authority, Zimbabwe Revenue Authority, had just made a public announcement on presumptive taxes.
There was an outcry after it was stated the taxes are to be paid monthly by informal businesses such as commuter omnibuses, retail shops (tuckshops), bottle stores, saloons and haulage trucks, among others.
Presumptive tax is not a new tax.
It has been there for more than a decade.
It was initially introduced as a means to coax informal businesses to formalise.
These are businesses that do not keep up a lot of paperwork, they hardly can fill the complex tax returns, but they are making money.
Hence, they should carry their fair share of the tax burden.
The presumptive tax outcry was immediately forgotten this week.
The Finance ministry announced the streamlining of fees that businesses pay.
It reduced the costs for many processes at farms, vehicle registration fees, vehicle license plates, change of ownership fees and parking fees in urban areas.
Understandably, the citizens were happy about the reduction of fees.
It leaves them with more disposable income.
However, this was done in an arbitrary manner.
No warning and appreciation of the precarious nature of the country’s revenue streams.
Finance minister Mthuli Ncube, at the end of July 2025, presented a Mid-Term Fiscal Review Statement before Parliament.
He waxed lyrically about the state of the economy.
Ncube said the country was poised for economic growth, resilient and that revenues were performing above target and hence there would be no supplementary budget.
It was a no brainer.
Zimbabwe, like other countries in the Sub-Saharan Africa, was struggling to fill the void left by arbitrary freezing of aid by the United States (US).
The US aid covered a number of issues that included public health and climate change.
My guess is Mthuli did not table a supplementary budget to align to political rhetoric that Zimbabwe was recovering and on its way to an upper middle income country status by 2030.
Zimbabwe had to pretend it needed no aid, despite the fact that its public health sector was entirely sustained by aid.
In his mid-term review statement, Mthuli did not give a hint about the fee reductions now being implemented.
His 2026 budget strategy paper, while acknowledging the need to improve the ease of doing business, did not get into specifics.
However, the reality is the fees reduction have a huge impact on the national budget revenue estimates and the financial health of local authorities.
Without explaining how Mthuli will fill the revenue gap, this new policy position remains populist.
Mthuli is busy giving sedatives to a country in pain.
Sedatives are not a cure, they just give momentary relief.
The country is burrowing deep into debt and future generations have to deal with it.
Mthuli is simply kicking the can down the lane.
The Auditor-General 2024 audit reports give a damning view of the country’s financial prudence.
It gives insights into wasteful expenditure, payments for goods and services that are never delivered and the worst of all, the Finance ministry using unappropriated funds.
The opposition has not helped matters.
It has not given a comprehensive response to these new policy positions.
The country does not know the full extent of the revenue void created and how it would be filled.
Whatever way it would be filled, is it sustainable?
Mthuli enjoys an easy ride in our Parliament.
Besides his fancy words in explaining the economic situation, the reality is Zimbabwe has piled debt faster under Mthuli than at any other time post-independence in 1980.
Mthuli has ducked from restructuring the economy, rationalising the civil service and enforcing fiscal discipline.
The hardest hit will be local authorities.
For the second time in just slightly over a decade, Zimbabwe will lose significant budgeted revenue by the central government’s new policy position.
In 2013, the central government wrote off residents’ arrears with councils.
It has not been fully calculated, but estimates nationally put in the US$2 billion to US$3 billion lost revenue.
The full facts may never be known considering the damning Auditor-General reports on local authorities.
Former Harare mayor Bernard Manyenyeni (2013-2018) wrote on his Facebook page the effect of this new policy on councils.
Posted Manyenyeni: “The Constitution has only two preambles; the preamble to the Constitution and the preamble to Chapter 14 Devolution. Only these two.
“A preamble emphasises seriousness preceding what you are about to read. Central government must stop running local authorities by using these decrees. We the illiterate 16 million scream ‘We receive!’ (Ignatius Chombo – Phase II)”
Then, Chombo was Local Government minister.
He issued the decree that wiped off the residents’ debts on the eve of the 2013 general elections.
Some councils are still to recover from that carnage.
Zimbabwe needs such kind reasoning at the appropriate forums. These are Parliament and councils.
Zimbabwe needs people who ask based on the Constitution or ideological framework to expose the hollowness of central government half-baked policies.
In slightly over six weeks, Mthuli would be tabling the 2026 national budget.
Why did he not wait to include these new policies in that budget statement?
Why did he find it necessary to introduce such drastic policies that have an effect on revenues in such an arbitrary manner?
We may never know, but it’s not an overstretching imagination that there is something brewing in the background and there are some companies making a killing off the government’s generosity.
In the end, Zimbabweans need to know what game Mthuli is playing.
This can only be known by asking him in Parliament why he introduced these policies without warning and where will the money come from to fill the revenue void?
I’m out!
Source: NewsDay
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