MPs hammer govt, reject $950m request

via MPs hammer govt, reject $950m request 23/09/2014

OPPOSITION legislators on Tuesday shredded Finance Minister Patrick Chinamasa’s mid-term fiscal policy review statement in which he wanted the House to approve a $950 million supplementary budget.

Led by former finance minister, Tendai Biti, the opposition MPs said the government was now clueless on how to resolve the people’s economic challenges.

Biti said instead of assisting grow the economy, Chinamasa, in his statement, was destroying the lives of ordinary people through more taxation and a “clueless macroeconomic strategy”.

“The tax measures that he put are actually intended to take money out of our pockets,” he told a thundering house with support from both his foes and political allies across the political divide.

“You cannot put duty on mobile handsets, you cannot tax airtime, and you cannot put duty on basic foodstuffs. These are things that help grow the economy, but the minister in his wisdom decided otherwise,” he said.

Biti said Chinamasa should seek advice even from across the political line to salvage the country’s economy which he said risks falling into the pre-2008 mode.

“In other words, if I was earning a dollar, as of September 11, 2014 when the honourable minister delivered his statement, the net effect of his tax measure is that the dollar that I had as of 11 September is now effectively 50 cents,” he said much to the applause of MPs.

Chinamasa last week presented a mid-term policy review statement in which he announced duty on imported handsets, upped excise duty on fuel by five percent and introduced a five percent levy on airtime to fund “enforceable government expenditure”.

Biti, who now leads a break-away faction of the MDC, said the country’s economy is shrinking year after year, down from 11.9 percent in 2011 to as low as 3.1 percent this year.

Biti was the finance minister during the inclusive government where he is credited with taming record inflation and presiding over economic growth rates of six percent per annum.

“In 2009 we had economic growth of 5.4% and in 2010, we had 10.4%. In 2011 we had 11.9% and in 2012 we started to have a downward economic growth of 10.8%. In 2013 our economic growth dropped to figures that varied depending on who you were talking to with some saying 3.4 % while others said 6%,” Biti said.

He said Chinamasa, in his statement, admitted that the country’s revenue collection target of $4.1 billion was unrealistic and government was “only hoping to realise $3.8 billion, but was at the same time approaching parliament to approve a supplementary budget of $950 million”.

“Where will he get the $950 million that he wants this House to approve if by his own admission, he says he will not realise the $4.1 billion aimed revenue? It is a dream . . . and we cannot allow government to do so,” he said.

MDC MP, Priscilla Misihairabwi-Mushonga, also told Chinamasa to formulate strategies that would attract foreign direct investment and stop scaring away potential investors through political mismanagement and bureaucratic bottlenecks.

Another MDC-Renewal member, Lucia Matibenga, who is the MP for Kuwadzana, pleaded with Chinamasa to reconsider the taxes announced last week saying the already impoverished workers will not cope.

David Chapfika, the chairperson of the parliamentary committee on budget and finance said although the minister announced measures to assist farmers in preparation for the coming season, it was important that funds are released in time to avert hunger.