TREASURY expects to collect at least RTGS$600 million through the two percent tax that Government imposed on all electronic transactions late last year.
In a latest progress report on the implementation of policy reforms under the Transitional Stabilisation Programme (TSP), the Minister of Finance and Economic Development, Professor Mthuli Ncube, says the new tax was proving to be an effective revenue stream for the fiscus.
“Already, RTGS$52,5 million was raised in November and RTGS$103,8 in December 2018, giving a total of RTGS$166,2 million for 2018.
“By January 2019, the Electronic Transactions Tax raised RTGS$98,5 million and it is anticipated that RTGS$600 million will be raised during 2019,” he said.
Government last October introduced the two cents tax per every dollar transacted as part of measures to widen the revenue base. The new tax replaced the previous tax of five cents per transaction.
Prof Ncube has said the bulk of the revenue from this tax head was being used to finance critical infrastructure projects such as roads.
To improve on revenue administration, Government has also appointed a new Zimra board led by renowned industrialist, Calisto Jokonya, which is expected to spearhead the recovery of outstanding debts estimated at above RTGS$4 billion and other strategic interventions to improve efficiency of the authority.
Owing to enhanced expenditure management and revenue enhancing measures, the report shows that monthly budget deficits for Government declined from RTGS$651,2 million in August 2018 to RTGS$39,8 million in September and RTGS$242,1 million in November. Indications point to a surplus of RTGS$732,7 million in December 2018.
“With regards to January 2019 preliminary figures, revenue of RTGS$508,5 million were realised against disbursements or commitments of RTGS$395,5 million, indicating a surplus of about RTGS$113 million,” said Prof Ncube.
He said Government was forging ahead with the implementation of fiscal and monetary reforms to consolidate gains achieved so far.
This includes taming distortions that promoted the parallel market to thrive leading to run away exchange rate premiums of as high as US$1:4 bond note and even higher in some cases, which in turn pushed up prices beyond the reach of the majority.
“The New Monetary Policy, therefore, sets a robust market based framework for determination of the exchange rate, that way, facilitating financial sector stability, containment of inflationary pressures and building of confidence,” said the minister.