… His 2022 budget proposal too elitist
… MPs must reject capitalistic budget
Theresa Takafuma
Minister of Finance and Economic Development Professor Mthuli Ncube has proved himself an ‘anti-poor hardcore capitalist’ following his proposed levy of US$50 on all imported cellphone handsets in the 2022 budget. The move has been met with disgruntlement by the general citizenry, civic society and business community as it seeks to reverse the gains made in mobile penetration so far, especially in the face of Covid-19 era where use of electronic gadgets heightened.
During his 2022 national budget presentation to Parliament on November 25, Prof Ncube proposed that US$50 is to be collected prior to the registration of every new handset that would have been brought outside Zimbabwe, with Mobile Network Operators (MNOs) now having the mandate to impose the levy on behalf of government.
“Mr Speaker Sir, whereas imported cellular telephone handsets attract modest customs duty of 25%, the funds realized, however, point to evasion of the customs duty due to the nature of items which can easily be concealed.
“In order to curb tax evasion, I propose to introduce a levy of US$50 which will be collected prior to registration of new cellular handsets by Mobile Network Providers.
“However, where duty would have been paid, the Zimbabwe Revenue Authority will provide a refund of the levy, within 30 days of receipt of payment from the mobile network operator,” Prof Ncube said.
Senators and lawmakers are reported to have rejected the proposal during a post-budget seminar, citing its retrogressive nature on the ease of doing business amongst a plethora of other critical uses of cellphones.
Since his appointment as finance minister, Prof Ncube has courted controversy through taxing policies which have been widely condemned as anti-poor, and the cellphone levy will likely further widen the preexisting digital divide that has seen poor communities being left behind in technological advancement.
Political analyst Dr Alexander Rusero said just like all the other policies by Prof Ncube, the proposal is not pro-poor together with being both elitist and capitalistic in nature, which has been the norm in the second dispensation when it comes to taxing Zimbabweans.
“A government can never prosper by taxing its people, it has never happened anywhere in the world. No government in history of the world has ever prospered through the taxation of its own people, but this is exactly the approach that Mthuli Ncube seeks to cushion government expenditure and extravagance through punishing the poor.
“This is not only a violation of the moral principle of respecting everyone but it’s a violation of the constitution, which guarantees freedom of information and it is for both hardware and software,” Dr Rusero said.
Dr Rusero also said government’s proposed shifting the burden of collecting levies to MNOs is archaic and is likely going to cause unnecessary confusion as a lot will be required for the simple process of registering a mobile gadget, which was nonexistent during the government of national unity (GNU) era.
“Our government is in the habit of creating deliberate chaos where it is uncalled for and common sense should be used. The whole idea is a reflection of a law opinion on the poor. Why subject people to all those forms of harassment, bureaucracy, paperwork for simply owning a gadget? I don’t think it is proper.
“The GNU was a progressive era in Zimbabwe, as it saw the divide between the rural and urban starting to be bridged through duty free purchases of electronic imports and now we are turning the clock back,” Dr Rusero said.
Norton legislator Temba Mliswa echoed the same sentiments and said the proposal is not feasible but retrogressive given the importance of gadgets in pushing for the digitization of education among other things.
“If anything, these gadgets must be duty free to make sure that people have access to the digitization system that is being put in place. Online schooling now is through these gadgets and not only that; there is those small (tumbudzi) phone that go for five or ten dollars but they want fifty, how did they get to that figure? I don’t understand.
“My position as a legislator is that it is totally retrogressive and does not push the Agenda 2030 middle income on digitization as it is key towards anything. Other Members of Parliament unfortunately are whipped but that’s not to say that the truth is not said, it will stick,” Mliswa said.
Mliswa said it is on the onus of Zanu PF to whip its ministers in line at their caucuses which they have but they seem not to be doing that, which then leaves them at the mercy of the citizenry when such policies are put in place.
“You cannot continue whipping people on doing bad things. You’ve got to allow Zanu PF to be able to whip their own ministers in line at their caucuses but they seem not to do that and the minister ends up coming up with policies that are not linked to the people because they don’t caucus to say which direction do we take on this, so the electorate will always come out guns blazing because it’s not a pro-poor budget,” Mliswa said.
Masvingo Urban MP Jacob Nyokanhete said the policy will most likely affect all sectors as it will trigger price increases in mobile gadgets, which will in turn affect accessibility of technology to the general citizenry.
“Personally I am strongly against it because it will make the gadgets expensive. This will then affect all efforts of making technology accessible to everyone and online education will be greatly affected.
“All the sectors are to be affected. We should emulate the likes of Rwanda where gadgets are not taxed and Rwanda has one the fastest improving technology to the extent that even our Parliamentary Portfolio Committee went there on a benchmarking visit,” Nyokanhete said.
Senator Chief Fortune Charumbira was also quoted in the state media saying the proposal had been rejected at a pre-budget seminar and was surprised to have seen it included in the budget.
This could be an indication of Prof Ncube’s adamancy on taxes, evident in the policies he has introduced since he got in office.
The Media Institute of Southern Africa on December 1 2021 released a statement where they castigated the proposal saying the push by parliamentarians to have the proposed levy scrapped should be upheld.
“MISA Zimbabwe urges the Ministry of Finance to instead work closely with the Ministry of Information Communication Technology, Postal and Courier Services, and other key stakeholders, to increase uptake in the usage of ICTs as opposed to imposing taxes and levies that widen the digital divide.
“While ownership of smartphones is one of the four pillars of meaningful connectivity, the high cost of these devices is the reason why some people do not use the internet which the African Declaration on Internet Rights and Freedoms has declared a fundamental human right,” read part of the statement.
Statistics released by online data platform Datareportal indicated that as at January 2021, there were 14.76 million mobile connections in Zimbabwe, which was equivalent to over 98 percent of the total population but with some people having more than one mobile connections, the number could be lower.
MNOs’ capacity on providing efficient mobile money services has not been the best, as some fail to refund clients who would have lost their money through unstable connections or network glitches.
If the new policy is to see the light of day, the MNOs will then have to refund those who would have provided a valid proof of having paid customs duty within 30 days, a period which is hardly feasible due to their capacity.
Minister of ICT, Postal and Courier Services Jenfan Muswere has been blasted by analysts for his passive approach on ICT matters, and many wait to see how he will react to Prof Mthuli’s proposal, which threatens the convenience of the larger part of his government mandate.
Prof Mthuli Ncube’s policies have largely been criticized for milking citizens dry through taxation, which also has seen him crediting himself for having a budget surplus more than once, while the larger part of the population wallows in poverty.
In the 2022 proposed budget, Prof Ncube projected an increase in government expenditure, and with the 2023 harmonized elections approach, more financial resources will be required to fund elections, which will probably see citizens being burdened by more taxes.
