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Ngoni Dapira
THE Manicaland business community has expressed mixed feelings over the 2015 national budget presented last week Thursday by the Finance and Economic Development Minister, Cde Patrick Chinamasa.Although most analysts agreed that Minister Chinamasa tried to be pragmatic about tackling the economic stalemate and Catch-22 situation that our economy has plunged into, others felt he left out some key areas.
Confederation of Zimbabwe national vice-president, Mr Henry Nemaire said holistically it was a good budget but the Finance Minister failed to protect the local tea sector, which is a major economic booster and employment creator.
Mr Nemaire who is also the finance director of Tanganda Tea Company said local tea growers could supply the national demand for teas, but imports were choking them.
He said the protection from imported packed teas and duty exemption of tea boxes, foil paper and tea bag staple was required to boost the sector.
“Tea growers based in Manicaland, produce 15 500 tonnes of bulk tea annually of which the Zimbabwean market consumes approximately 4 000 tonnes.
“Specialty teas such as Rooibos, Herbal and Green teas are produced by Zimbabwean growers and blenders, but cheap imports still come in and override local producers.
“Presentations have been submitted to Ministry of Industry and Commerce in this regard, but surprisingly no single protection policy has been crafted for the tea sector. Between Tanganda Tea, Ariston, Lyons and Four Seasons, Zimbabwe produces enough packed teas with a wide variety of lines for the local market hence the sector is actually the best candidate for protection from foreign competition,” said Mr Nemaire.
However, he applauded Governments medium term power projects that will create surplus power of 2 857 MW by 2019. He said power generation was key for the growth of the manufacturing sector. He also lauded the Government revenue-enhancing proposals such as collecting presumptive tax at licensing point, which has been proven to be a success in Kenya.
“This will mean commuter omnibuses, taxis and other truckers will now contribute to the revenue inflows. But then again, these sectors should however now be relieved of the indirect taxes and fines levied by law-enforcing agents,” he said.
He however requested Government to hasten the implementation of these projects.
An economist and business lecturer at Africa University, Mr Thomas Masese said the Finance Minister did justice in the 2015 budget, but underscored the need to look into the 81 percent wage bill by Government.
“We are spending too much on recurrent expenditure. Either we expand revenue sources or reduce salaries, of which the latter is not possible because of the high poverty datum line.
“Government must rationalize its functions which clash in some ministries so as to reduce the number of people employed. This 81 percent wage bill calls for an introspection. It would be interesting to investigate the Zambian minimum wages and compare with Zimbabwe a country of similar size population-wise, but half the Gross Domestic Product,” said Mr Masese.
He also questioned why Government reversed the 15 percent tax on unprocessed platinum up to end of 2015 when the Zimbabwe Agenda for Sustainable and Socio-Economic Transformation blueprint was pushing for beneficiation.
Zimbabwe Council for Tourism president, Mr Francis Ngwenya said Minister Chinamasa did justice for the tourism sector to assist in increasing revenue and attracting more arrivals.
“The 2015 national budget puts us on course in the tourism sector. This is a very well thought out budget which has taken the voice of our sector into being.
“The exclusion of Value Added Tax on tourist earnings is what we have been advocating for and we are glad the Finance Minister heard our voice.
“The extension of Statutory Instruments that create free rebate on imported capital goods and motor vehicles is very welcome. We, however, wanted it to be extended to car hire companies as well.
“The quality of their vehicles is not the same as our regional competitors, so they should also be included in the exemption group,” he said.
Several analysts commended the noble initiatives by the Finance Minister.
Local businesswoman, Ms Getrude Mutandi commended Minister Chinamasa on raising the issue of special economic zones, which she said were key in attracting foreign direct investment.
Minister Chinamasa said that in the coming week he would be presenting the Special Economic Zones proposals to Cabinet for approval citing how industries countrywide were facing insurmountable challenges which required substantial investment injection.
The minister added that work on SEZ was at an advanced stage and government was working on a hybrid approach in which several models were being pursued.
Others commended the review of tax provisions on the mining industry and said it would result in the boost of mineral production, value addition, employment creation and community development.
Online Reporter