By Dennis Ndlovu| Zim GBC News<\/p>\n\n\n\n
In a heated parliamentary session on Tuesday, Zimbabwe\u2019s lawmakers debated the 2025 Finance Bill, with a strong focus on tax adjustments aimed at increasing government revenue while promoting the use of the local currency, the ZiG.<\/p>\n\n\n\n
Finance Minister Prof. Mthuli Ncube defended several key proposals, including a reduction in the Intermediated Money Transfer Tax (IMTT) on ZiG transactions from 2% to 1.5%, while keeping the IMTT on US dollar transactions at 2%.<\/p>\n\n\n\n
He explained that the move is designed to discriminate in favour of the ZiG and encourage its adoption.<\/p>\n\n\n\n
\u201cWe want to shift the preference towards the domestic currency,\u201d Ncube stated.<\/p>\n\n\n\n
However, this differential treatment faced pushback from several MPs.<\/p>\n\n\n\n
Hon. Edwin Mushoriwa argued for uniformity, stating,<\/p>\n\n\n\n
\u201cWe need to make sure that there is a uniform taxation system1.5% to US, 1.5% to ZiG.\u201d<\/p>\n\n\n\n
He warned that maintaining a higher rate on USD transactions unfairly burdens the poor and those in the informal sector who primarily use foreign currency.<\/p>\n\n\n\n
The debate also covered a proposed 0.5% increase in Value Added Tax (VAT), from 15% to 15.5%, which the Minister framed as a compensatory measure for the reduced IMTT on ZiG.<\/p>\n\n\n\n
Critics, including Hon. Maureen Kademaunga, highlighted the impact on low-income earners<\/p>\n\n\n\n
\u201cMost low-income-earning families use 60% of their income on household goods that are going to be affected by this 15.5%,\u201d she said.<\/p>\n\n\n\n
Another contentious issue was the introduction of a presumptive rental income tax of 25% on property owners, which was later revised down to 15% following protests from MPs.<\/p>\n\n\n\n
Hon. Nelson Tsvangirai argued that the tax contradicts the Government policy for providing affordable housing and would ultimately be passed on to tenants.<\/p>\n\n\n\n
Minister Ncube acknowledged the concerns and agreed to reduce the rate, but emphasized the need for compliance.<\/p>\n\n\n\n
\u201cIf a property owner does not reside in your property but you elect to have tenants and make money out of it, you are not a poor individual, \u201d he said.<\/p>\n\n\n\n
He also announced the removal of a proposed cash withdrawal levy after widespread criticism that it would discourage banking.<\/p>\n\n\n\n
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