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Taxable Income, Health Crisis Dominate 2021 Budget Consultations

The current tax-free threshold for Personal Income Tax and the deplorable state of affairs in the country’s health system took center stage at the 2021 National Budget Consultation meeting held this morning in Harare amid growing calls for government to prioritize worker welfare and the healthcare sector, 263chat Business has established.

The call comes at a time the value of incomes has been deeply eroded by the hyperinflation obtaining in the country.

Year on year inflation has surpassed 750 percent while incomes have failed to keep pace hence falling far below the Poverty Datum Line (PDL).

“As workers we call for the preservation of value of our incomes. We feel there is a need to revise taxes. Our taxes should be looked at. If someone earns below the Poverty Datum Line and then you want to tax that poor salary what will they be left with. We urge Government to consider people earning below the poverty datum line to be exempted from tax,” said one participant representing the Zimbabwe Congress of Trade Unions (ZCTU).

In August, the PDL stood at ZWL$ 17 244 yet an average Zimbabwean worker from both the public and private sectors earns around ZWL$ 6 000 per month.

The development has led to deteriorating standards of living for ordinary workers leading to continued wage contestation between workers and employers.

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However, Government recently reviewed upwards the tax-free threshold from ZWL$ 2 000 to ZWL$ 5 000 per month.

Zimbabweans became one of the most taxed in the region after government in 2018 introduced the two percent intermediary money transfer tax.

Another key sector participants were mainly concerned about was that of health.

Lovemore Makumbirofa from the Cancer Association of Zimbabwe called for an improved health budget allocation for 2021 to levels in line with the country’s global health commitments such as the Abuja Declaration which dictates that the health budget should at least make 15 percent of total National budget.

He also called for a standalone Cancer fund to help capacitate public healthcare centers with drugs and treatment of the disease.

“Cancer patients are struggling to get treatment because public Cancer treatment is very expensive and is not accessible at public health institutions. In most cases patients end up with the only option of getting drugs from private pharmacies which is very expensive, said Makumbirofa.

Another participant, Doreen Muzhindu called on government to make interventions on the hearing aids, which she said was beyond the reach of the deaf.

“We are saying government should look into the issue of hearing aids. They are too expensive hence we ask if it’s possible that they can be subsidized or even be given for free,” she said.

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There were also submissions for government to regularize some informal settlements such as Hopely which have been in existence for decades now but are yet to get sewer connections, access to tap water and other services.

“Since 2005 we have not been regularized. In Hopely we don’t have sewer pipes, electricity and other service provisions. We have pregnant people who are giving birth in homes because we don’t have a hospital and in most cases the local clinic refers patients and pregnant women to Rutsanana polyclinic in Glenorah,” said Precious Mapfigu from Transparency International Zimbabwe.

The Finance and Economic Development is expected to deliver the 2021 National Budget next month amid a cocktail of challenges facing the country.

Analysts say the budget is going to be delicate task for the Minister to balance with dwindling revenue flows into the fiscus on one hand and the bourgeoning expenditure list to spur economic development on the other.

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