Unemployment causes decrease in govt revenue

GOVERNMENT revenue for the first quarter of 2016 has declined due to the decrease in the number of formally employed people and the decline in domestic firms’ profitability, statistics compiled by the Zimbabwe Economic Policy Analysis and Research Unit (Zeparu) have shown.

Source: Unemployment causes decrease in govt revenue – NewsDay Zimbabwe May 16, 2016


According to the 20th edition of the Zeparu Economic Barometer report, government’s net revenue for the first quarter of 2016 stood at $808,36 million, having declined by 2,7% from $830,77 million realised over the same period last year.

“The decrease in revenue collection in 2016 was mainly weighed down by the decline in tax on incomes and profits, customs duties and excise duties, which fell by 18,1%, 13,5% and 3% respectively,” Zeparu said.

“These revenue heads were mostly affected by the fall in the number of people formally employed and the decline in domestic firm’s profitability on the back of a decline in consumer demand.” According to the report, despite these downturn, improvements were noted in non-tax revenue, indirect taxes and value added tax, which grew by 136,02%, 9,5% and 0,61% respectively.

Total government expenditure and net lending for the first quarter of 2016 stood at $968,16 million, having registered a 0,51% decline from $973,12 million recorded in the comparable period in 2015.

“The fall in government expenditure was mainly driven by the decline in the costs of goods and services, which shrunk by 1,15% from their levels in 2015, as government employs measures to contain operational costs,” reads the report.

In the period under review, government expenditure exceeded total government revenue, resulting in a budget deficit of $159,81 million.

Zeparu said this budgetary deficit was mainly financed by loans and Treasury Bills from domestic sources.

On a month-on-month basis, total net government revenue rose by 14,76% in March 2016 from $249,22 million in February 2016, while expenditure and net lending also rose by 1,3% from $303,4 million in February 2016.

“Since government expenditure exceeded revenue, it resulted in a budgetary deficit of $21,34 million in the month of March 2016. This was, however, a 60,61%decline from the February 2016 levels,” Zeparu said.

The latest Zimbabwe Revenue Authority (Zimra) annual revenue performance update for the year ended December 31 2015 shows that companies and individuals were struggling to pay outstanding tax liabilities to government and were sinking deeper in arrears. About 4 610 companies closed down between 2011 and 2014, resulting in the loss of 55 443 jobs due to a myriad of operational and macro-economic challenges including lack of access to affordable capital, poor infrastructure and erratic and costly supply of utilities.

According to trade unions, the July 17 Supreme Court ruling of last year, which allowed employers to dismiss workers on three months’ notice, has also resulted in the loss of more than 30 000 jobs across all sectors of the economy.


  • comment-avatar
    tonyme 6 years ago

    Somebody should have thought about and do something about this a long time ago. Otherwise we wouldn’t be thinking about printing money. We really need some brains in leadership. Stealing has become the norm that honesty has been shoved off the list of priorities.

  • comment-avatar
    tonyme 6 years ago

    Which parastatal is not stealing in millions? no wonder why we are broke.

  • comment-avatar
    Zambuko 6 years ago

    That’s four companies and fifty jobs a day for every day in the year.

    What happened to the million job promise?

  • comment-avatar
    Jono Austin 6 years ago

    Hence the bonds-watch as Govt employees get paid by them and brace yourself for inflation, caused by ‘greedy shopkeepers’ of course

  • comment-avatar


  • comment-avatar
    IAN SMITH 6 years ago

    The real nail in the coffin was hammered in 2000 when Gangster Bob expelled the farm managers off the farms for the sake of the color of their skin, 100000 workers lost their jobs in one year most just died of starvation and poor health.
    Now Bob’s terrified of mob justice coming back to bite him in the a–s.