Of concern to the overall economy in Zimbabwe is that in less than a year government had borrowed $4billion, which saw the domestic debt doubling to the current levels of $9.5billion. Wages are a major driver of government expenditures (around 90% of revenues), with 40% being allowances for senior government officials. Certain revenue enhancing measures in the 2019 budget include, excise duty which will go up by 7 cents per litre on diesel and paraffin and 6.5 cents on petrol. A “money transfer tax” will be introduced, which is calculated at the rate of US$0.02 on every dollar transacted for each transaction. Road traffic offenses will be moved from the Standard Scale of Fines with a maximum monetary value of $30 to levels 8 to 10, which attract a maximum fine of US$700 and imprisonment for a period not exceeding 12 months, with effect from January 1, 2019. In conclusion, Christina mentioned that big “take home” from the 2019 budget is that the “USD is equal to bond note, but the bond note is not equal to USD”. Buying or selling forex attracts a 10 year jail sentence, but paying duty in forex is permissible, no questions asked and finally, whilst it is the government that is undertaking the austerity measures, the impact cascades to all citizens. A reduction in government spending implies projects and programmes, which were benefiting society are stopped, while an increase in taxes naturally reduces incomes.
Opposite page insert: Mr Learnmore Nechitoro, Top inset: Christina Muzerengi, Main pic: MIAZ president welsomes the SA delgation