Government trafficking workers are dry – NewsDay Zimbabwe

BY TAURAI MANGUDHLA
The latest report from the Zimbabwe Revenue Authority (Zimra) has shown that workers are among the government’s main cash cows contributing more to the national stock market than companies.

The latest figures from Zimra show that individuals, through pay-as-you-go (Pay), contributed 17.9% of the overall quarterly tax figure, while corporations contributed 15.3%.

“Taxes collected from individuals nominally increased by 97.48% in the first quarter of 2022 compared to the same period in 2021. This largely reflects general wage increases made in different sectors to protect employees against the rise. cost of living,” Zimra said in its latest earnings performance report.

Experts said the statistics clearly testified that workers were being overtaxed, preventing them from making ends meet with what little was left after tax following runaway prices for basic goods and services driven by runaway inflation.

Trade unionist Peter Mutasa said workers in Zimbabwe were overtaxed compared to other countries in the region due to the heavy basket of taxes on top of Paye.

“We have Paye, which can reach 40%, we also pay the National Office of Social Security tax, on top of that, workers pay other indirect taxes like the IMTT of 2% (tax on intermediary money transfers), we also pay taxes to local authorities and beyond that we pay VAT (Value Added Tax),” said Mutasa NewsDay yesterday.

“If you look at how much a person has left after tax, it’s a small fraction of your gross salary and it reflects the nature of the austerity we have,”

As other countries sought to reduce the tax burden on workers, Zimbabwean authorities introduced new taxes such as flat tax and IMTT to increase the revenue base.

This has increased the pressure on workers, the majority of whom earn below the living wage.

The latest data from the Zimbabwe National Statistics Agency indicates that a family of six now needs $68,178 to survive for a month.

Zimbabweans have been hit by a wave of price hikes as the local currency continues to lose value, while inflation soared to 96.4% this week, raising fears of a return to the hyper-inflationary era of 2008.

Public and private sector workers are demanding wages in US dollars, with teachers saying they are unable to return to work next week when schools open.

“Labour should demand that we carry out an overhaul of tax systems,” Mutasa added.

Former finance minister Tendai Biti said yesterday that Zimra’s figures confirmed that Zimbabwe was in a “deep depression”.

“If you look at the International Monetary Fund’s Article IV report, it actually confirms that this economy was in a deep depression, so when you’re in a deep depression, there’s basically no economic activity, so what that means is that you pressed the individual,” Biti said, adding that it showed the economy is weak, unbalanced and out of balance.

“They (the government) are pressing the ordinary person. They’re trying to get water from a rock because in a normal economy you can’t compare corporate tax to personal tax, corporate tax is more,” a added Biti.

Meanwhile, net revenue collected by Zimra was $174 billion in the first quarter of 2022, representing a 5.2% variance from the target of $165.4 billion.

About Alma Ackerman

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