Zim leader Mnan­gagwa's cabinet 'di­vided over new tax'

Observer on Saturday - - News -

- Zim­bab­wean Pres­i­dent Em­mer­son Mnan­gagwa's Cabinet is re­port­edly di­vided over a new 2c per dollar tax which has been im­posed on elec­tronic trans­ac­tions by Fi­nance Min­is­ter Mthuli Ncube.

A cur­rency crunch and a new tax on elec­tronic trans­ac­tions has spawned fears that Zim­babwe's wrecked econ­omy is about to en­dure a fresh bout of chaos, re­ported AFP.

Mnan­gagwa had cam­paigned on a pledge to re­vive the econ­omy, at­tract for­eign in­vest­ment and cre­ate jobs.

But less than three months af­ter the vote, the dire fi­nan­cial prob­lems of former pres­i­dent Robert Mu­gabe era have re­turned to haunt the new leader.

The lat­est cri­sis erupted last week when the fi­nance min­is­ter an­nounced the 2c tax on all elec­tronic trans­ac­tions to in­crease rev­enue.

Many Zim­bab­weans re­lied on elec­tronic pay­ments as US dollars, which func­tioned as the main cur­rency, were scarce, and the lo­cal "bond note" cur­rency was lit­tle trusted.

Ac­cord­ing to Daily News, un­named sources said that min­is­ters in so­cial ser­vices were wor­ried that the new tax would dam­age the new govern­ment's im­age af­ter the new aus­ter­ity mea­sure was re­sound­ingly re­jected by the pub­lic.

Some min­is­ters - even in the eco­nomic min­istries - were among the first to go pub­lic in urg­ing the govern­ment to back­track on the new aus­ter­ity mea­sures, said the re­port.

En­ergy min­is­ter, Jo­ram Gumbo warned that the new mea­sures would lead to mas­sive fuel price in­creases which would po­ten­tially lead to chaos in the econ­omy.

Small to Medium En­ter­prises Min­is­ter Sithem­biso Ny­oni re­served her reser­va­tions over the mat­ter, say­ing that while there were ben­e­fits from the aus­ter­ity mea­sures, a thor­ough study of is­sues was needed – in­clud­ing an in­put from stake­hold­ers.

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