By Daniel Chigundu
Bulawayo South legislator Eddie Cross has urged Finance and Economic Development Minister Patrick Chinamasa to consider putting a 5 percent tax on all electronic transfers.
Owing to the obtaining cash crisis in the economy, most people have resorted to using electronic transfers to make payments for goods and services.
This has seen electronics transfer statistics rising astronomically to about US$180 billion in 2017 (swipe transaction US$76 billion, RTGs US$50 billion and Ecocash US$1billion per week).
Presenting the Finance Committee Report on the 2018 Finance Bill, Cross said the electronic transfer figures presents another revenue stream for the cash strapped government.
“…we are looking at the total value of electronic transfers in 2017 of $180 billion. To me as an economist, that reflects the fact that our actual economy is much bigger, probably more than double the size of the figure estimated by the Minister.
His figure only reflects the value of the formal sector, but if you add the informal sector trading into our national economy, we probably have an economy in excess of $40 billion.
“Mr Speaker, several months ago when you raised the idea that we could have a US$10 billion budget, I was very skeptical, but the reality is; if our real GDP is $40 billion, then 25% of our GDP is $10 billion.
“Mr Speaker Sir, I believe that we can cover the shortfall in our revenues. We can provide more money for our health sector; we can fund the Parliament of Zimbabwe properly if we put a small tax on electronic transfers. If we put 5%, five cents in a dollar on that, it is $9 billion of new revenue,” he said.
The economist-cum politicians said putting a tax on electronic transfers was cheap to collect and most people will pay that tax.
“If you put a tax on electronic transfers, it is easy and cheap to collect and everybody pays. If you step into an emergency transport taxi and you pay your fare using ecocash, you pay five cents to the Minister of Finance, it would solve our problems overnight.
“It will reduce expenditure on labour and salaries to 35% of our budget; it would eliminate our deficit immediately and give us resources to settle our bill with the multinational agencies. I think that we have to look at this,” he said.
It however remains to be seen if Minister Chinamasa will heed the calls as some economists are of the view that Zimbabweans are already over-taxed.
By Daniel Chigundu