Chronicle Editor
Judith Phiri, Business Reporter
The Minister of Finance, Economic Development and Investment Promotion Professor Mthuli Ncube has proposed to review the local currency tax-free bonus threshold from Z$500,000 to Z$7 500 000, with effect from 1 November 2023, as a cushion for employees.
He revealed this during the 2024 National Budget while unpacking some of the tax policy measures meant to provide relief to taxpayers and enhance the capacity of Government to generate additional revenue.
Prof Ncube said on personal income, he was proposing to review the tax-free threshold to Z$750 000 per month or Z$9 000,000 per annum, and adjust the tax bands to end at Z$270 million per annum, above which tax will be levied at a rate of 40 percent, with effect from 1 January 2024.
Other key highlights of the tax policy measures include a review of the tax-exempt threshold on withholding tax on agricultural commodities that include soya beans, sunflower, groundnuts and cotton seed from US$1 000 per annum to US$5 000 or local currency equivalent for small-scale and subsistence farmers as well as suspension of duty on motor vehicles imported by safari and tour operators for a further two years, beginning 1 January 2024.
He also noted that only traders registered for VAT purposes and in possession of valid tax clearance certificates will be eligible to procure goods from manufacturers. Minister Ncube proposed that no transfer of mining rights shall be approved without payment of capital gains tax and stamp duty or any other tax due on the value of the transaction
. He emphasised the need for lithium beneficiation saying any lithium value addition process that does not result in the production of lithium carbonate is not regarded as beneficiation, hence, is liable to an export tax.
“Lithium producing companies should submit their beneficiation plans no later than 31 March 2024. No licences shall be granted to a prospective lithium company without approval of a beneficiation plan,” he said.
He also proposed to introduce a one percent levy on gross proceeds of lithium, black granite and other cut or uncut dimensional stones and quarry stones.
Prof Ncube also proposed an upward review of toll fees on premium roads, that is, Harare-Beitbridge and Plumtree-Mutare and other roads, with effect from 1 January 2024.
Revenue derived from the increased fees will be remitted to the Consolidated Revenue Fund.
The Minister said passport and selected fees charged by the Central Vehicle Registry will be increased with effect from 1 January 2024.
Additional revenue generated from the above measures will be ring-fenced towards road infrastructure development.
Bongani Ndlovu