by Gift Mashoko

The Confederation of Zimbabwe Industries (CZI), has welcomed the 2 cents per dollar tax on electronic transactions, announced by Minister of Finance and Economic Development Professor Mthuli Ncube, as the country moves to widen its tax base.

In a letter dated 2 October 2018 addressed to Minister Ncube, CZI highlighted that the measure would go a long way in widening the tax base net.

“We appreciate the advantage of this tax as it is a method of taxing the informal sector and thus widening the tax net. We are very supportive of this approach,” read part of the letter.  

One economic analyst, who preferred anonymity said the stance taken by the Minister to have 2 cents per dollar tax on electronic transactions, was a bold and noble step in the right direction as the government tries by all means to rebuild the economy. He said this way the Government would be able to tax even informal businesses that were getting away with non-payment of tax.

Former Finance Minister and MDC Alliance Vice Chairperson Tendai Biti was lambasted by citizens after he had negatively commented on Minister Ncube’s presentation

 “The upward review of the 5 cent Transfer Tax to 2 cents a dollar is both naïve, cruel, insane and insensitive. The regime having destroyed cash payments in Zimbabwe can’t tax alternative transfer methods. This will punish the poor and destroy companies.#Croconomics is as shocking as it is crude,” tweeted Biti on his Twitter handle.

Responding to Biti, Simbarashe@simplexQ tweeted, “If you appreciate that our economy is highly informalised and we haven't found a way to tax this informal sector, you will understand the creativity, imagination and brilliance behind this tax.”