via ‘Empowerment levy progressive, friendly’ | The Herald January 5, 2016
Happiness Zengeni and Tinashe Makichi
Reserve Bank of Zimbabwe governor Dr John Mangudya has said the Indigenisation Compliance and Empowerment Levy which will be levied on all business should be seen as progressive and market friendly as it favours those who choose to comply with the laws of Zimbabwe.
Under the new Frameworks, Procedures and Guidelines for implementing the Indigenisation and Economic Empowerment Act announced yesterday, an Indigenisation Compliance and Empowerment Levy at a rate to be prescribed shall be levied on all businesses.
Companies that comply will benefit from an indigenisation rebate.
According to the framework, a standard formula based on a prescribed rate, that is linked to the annual gross turnover of the business entities will be determined in establishing the extent to which the individual entities are supporting socially and economically desirable objectives.
The levy is subject to reduction by the Compliance and Empowerment Rebate score earned by any business.
“Effectively this Indigenisation Compliance and Empowerment Levy can be significantly moderated by the extent to which a business simply decides to comply with the laws of Zimbabwe on indigenisation and economic empowerment,” reads part of the framework.
Dr Mangudya who supported Youth, Indigenisation and Economic Empowerment Minister Patrick Zhuwao and Finance and Economic Development Minister Patrick Chinamasa at a press conference yesterday said the levy was progressive and market friendly as only those who did not wish to comply with the Indigenisation Act will pay it.
“Going forward we expect the economy to move in tandem with expectations. The Compliance and Empowerment Levy is a progressive levy where the non-compliant will pay more and the compliant will pay zero. This is a market friendly policy that simply states that those who choose to comply pay more and those who comply pay nothing,” said Dr Mangudya.
Minister Chinamasa said Government was however, yet to come up with a figure on the new levy but said the money would be pulled into a fund that will be used to support empowerment initiatives by disadvantaged groups.
The framework states that the Indigenisation Compliance and Empowerment Rebate Score shall be calculated against the Indigenisation Compliance and Empowerment Levy in such a manner that any business shall be able to reduce the levy payable by it according to the rebates it has earned.
The rebate can be earned from indigenisation legislation compliance rebates, good corporate citizenship rebate and indigenous shareholding rebates.
A maximum possible 100 percent Rebate Score will mean that a business has effectively complied with the Indigenisation programme and does not need to pay the levy.
Dr Mangudya also said that following the announcement of the new framework, the country is now ready and open for business.
He reiterated that 2016 is a transformative year and the Indigenisation law is one of the agendas on the desk which had been lagging behind.
“Having gone through the frameworks I have come to the conclusion that Zimbabwe is ready for business,” said Dr Mangudya.
The framework aims at ensuring that the implementation of indigenisation and economic empowerment works with other Government initiatives to attract investment.
COMMENTS
The Good and the Bad pay the Empowerment Levy.
The government is now open for business.
The government now also has the money.
The government then looses some of the money and spends the rest.
The Good then have to deal with the burden of recovering their payment from the government.
The Bad get on with business.
The Empowerment Levy seems to me to be good for government and bad for the Good.
Oh, and the Ugly.
Can these clowns ever get it right? I must pay a thief, to sustain him or her so that one day he or she can come and purchase me with my money that they never earned. Are you for real? This is madness. No one is going to invest your idiots!!!!!!!!!!
For “levy” read “fine”. Which, of course, will find its way into soneone’s pocket, rather than doing anything for the country proper…
Racism is the law in Zimbabwe. Combine that with a criminal government and you get this type of double speak
the track record of government of zimbabwe is that “indigenisation” means taking your farm lock stock and barrel, without compensation, selling off the assets and then letting it lie idle.
nssa is also supposed to be progressive and friendly but ask any old aged pensioner whether they would agree.
it will take a lot more than the governor of the RBZ telling us that the “empowerment levy” is progressive and friendly.
its just another raid on the pockets of the private citizens by a destitute government seeking still more money for its own elite.
“Reserve Bank of Zimbabwe governor Dr John Mangudya has said the Indigenisation Compliance and Empowerment Levy which will be levied on all business”
So the businesses are not making any profit to pay tax wages etc.
Business can not put $US in any bank Zanu tribal indunas will grab it.
Where would the cash come from to donate to this looters levy?? or the Singapore retirement fund.
Let’s keep hoping some foolish white skin (settlers) will start business in Zimbabwe since no Black skins will entertain this madness.
IN YOUR DREAMS NO WAY IN HELL, A STARVING DICTATOR WITH ATTITUDE HA HA!
Wonderful news yet another “LEVY” that will help us!!! Aids Levy, drought levy, indigenisation levy. Soon enough everything you earn will be paid out in levy’s. You might ask where does all this money go to? Why do we always hear of some scheme and all the money is gone? Madness created by childish appointees…
I am hundred percent in support of indigenization and empowerment, however, what I can never come to terms with is the racist definition given to the phrase ‘indigenous Zimbabwean’. We seriously need to reflect on how we define an indigenous Zimbabwean. Whatever we do in empowering the disadvantaged we should not stifle growth or antagonize the the whole world, otherwise we will end up indigenizing poverty and disempowering the whole nation.
We will fine you if you don’t hand over your business. Do these clowns think anyone believes otherwise. Progressive and friendly-yeah right, you buffoons. Carry on destroying the country. At least ‘the settlers’ most of whom have left, had the best of it. What is left is a rubbish tip.
Yet another half baked policy is being wheeled out where the main driver just happens to be racism and hatred.
The fact that the percentage to be levied is not yet known shows that these guys are not even sure about that they are doing and they are bold enough to make an announcement.
Do they really model these policies first and see the impact on business and the economy?
I doubt that very much because all you see are relentless emotions propelled by the fear to deliver what Mugabe wants.
The existing businesses need support and not another levy to enrich the ruling family.
If they were serious about empowering anyone they would have stated exactly how the funds from the levy would be distributed and in what form.
You are all jumping to conclusions. This is a masterpiece of legislation which is going to kick-start the economy and provide capital for the disadvantaged Black people. You will be in the front of the queue when the capital becomes available.