Source: Government’s raft of new taxes akin to squeezing water from a stone – NewsDay Zimbabwe April 4, 2017
If anyone needed evidence that the Zimbabwean government is financially hamstrung and virtually clutching on to straws to survive, then last week’s overtures that it intends to tax hairdressers and small-scale businesses should put the matter to rest. Things are certainly not getting better. Why a government would go for broke — whacking its long-suffering and pitiable people with a raft of new taxes defies reason. Is this the way to raise revenue?
OPINION: Learnmore Zuze
Last week alone, the government introduced a number of new taxes targeting, of all business people, airtime vendors, struggling small to medium enterprises, motorists and commuter omnibus owners. This move of desperation is a massive indictment on the government of Zimbabwe. What the country has, on its roads, through police officers, is a daily blitz on motorists for the inanest of perceived offences.
It is not so much about the safety of the motorist but the pocket of the officers concerned. It is quite strange that Zimbabwe has a government, which believes in milking dry the very deprived person struggling to make ends meet.
The government firmly believes in syphoning the little that the ordinary man in the street has. One would, in all honest, think that at least the common man on the street must be exempt from the tax band, which on the formal sector, is pegged at $300. These new taxes come against escalating poverty in the country, which according to reports, over 76% of families in Zimbabwe are living on incomes well below the poverty datum line of $500.
It is simply unfeeling to demand that people living on petty incomes and worse, burdened with meagre incomes, be taxed by an overspending government. The only constant in the whole fracas is unbridled government expenditure seen through unconscionable spending on flights and splurging money on executives’ vehicles. The equation would have taken a semblance of balance if, correspondingly, the government reduced its profligate tendencies. This, sadly, is not the case. There simply is no limit to government spending.
It was further announced last Thursday by government that small-scale tobacco farmers should pay a 10% tax on their sales. This is simply unorthodox. The outcome of this is simple: Farmers will withhold their crops as they have already done. Government needs to explain this shocker of news. It would appear, in the government’s eyes, everybody else is exempt from the biting economic challenges serve for itself. For example, one may ask: Who is the motorist who has to be stopped on flimsy offences and made to part with hard earned dollars? Who is the farmer who has to pay the 10% tax on their produce? Who is the small enterprise owner who has now been dragged into the tax bracket? Isn’t the same motorist the very small enterprise owner who is being hard hit by this new order? Isn’t the same vendor the very person who hoards airtime with tax already incorporated?
Surely, this new raft of measures is, in all truthfulness, a harebrained idea. It betrays a government that is fast losing credibility. It impairs the dignity of the government. Water can’t be squeezed out of a stone. This new order will kill the little there is of small business in the country. The entire nation cannot work to raise revenue for the government. The government must have sound policies that can birth an increase in productivity. If government has economic growth promoting policies it would not need to tax struggling citizens for a day.
The Zimbabwean problem is one of the dearth of productivity; there is no productivity in Zimbabwe. The economy is barren, hence, the government resorts to economically slaughtering its own citizens. The government has become a beast preying on those it should cushion.
As they say, a bad law turns every person into a criminal. Expectedly, the new taxes will drive small economic players out of business forcing them to carry out their work covertly.
It is even ironic that while the government preaches economic empowerment and promotion of small enterprises during the day, they plot the downfall of the very ventures at night. Small economic players naturally won’t be able to survive under the new tax regime no matter how small the tax percentages may be.
In fact, throughout the world, the matter of overtaxing citizens has often been the nascent point of resistance and revolution. The government may need to be warned ahead of time that it may be walking a minefield by insisting on these new taxes.
Everyone is feeling the pinch of the current economic crisis. Ordinary people cannot shoulder government’s responsibilities. With taxing people should also come accountability? Does the Zimbabwean government, appear the likely administration to handle these funds with the requisite transparency? Already accountability on the money collected from tollgates remains shrouded in dark secrecy. Will these new taxes be used to the benefit of the economy knowing the poor record of revenue management by government.
Instead of adding weight on the burdened Zimbabwean people, the government needs to think in other terms. Cutting down on the top heavy executive would be a good starting point. The size of the Cabinet is no doubt unnecessary for a country with less than 15 million people. It’s a huge drain on the fiscus.
Water can’t be squeezed out of a stone without harming the stone (read Zimbabweans). The government needs this message badly.
Learnmore Zuze is a law officer and writes in his own capacity. E-mail: email@example.com