HARARE — MPs have urged the government to consider other avenues to increase its revenue base as the $4,4 billion budget announced recently will not be enough to stimulate economic growth.
Zimbabwe’s economy is stuttering and MPs said the 2014 budget did not do enough to stimulate recovery.
Contributing to a debate on the 2014 budget, Hatfield MP (MDC-T) Tapiwa Mashakada told the house that the budget exceeded what the government’s revenue could accommodate.
Last month, Finance minister Patrick Chinamasa presented a national budget of $4,4 billion against $8,9 billion votes. Over 75% or $3,6 billion of the budget will go towards civil servants’ salaries.
“The Finance minister has no room to manoeuvre because the revenue base is very low,” Mashakada said.
Mashakada, a former Economic Planning minister in the inclusive government, said there was need to augment available revenue generating capacity with foreign direct investment.
“There is no alternative, but to re-engage international financial institutions,” he said.
Zimbabwe last July agreed to an International Monetary Fund (IMF) staff monitoring programme, a major step towards normalising relations after the IMF suspended its voting rights in 2003 over policy differences with President Robert Mugabe and non-payment of arrears.
Mashakada dismissed the projected 6,1% growth rate for this year as unachievable as the agricultural sector, a main driver of the economy, was not performing well due to underfunding.
Former Finance minister Tendai Biti (MDC-T MP for Harare East) said the anticipated growth in the mining sector “does not sustain a growth of 6,1%”.
Contributing to the debate, MP for Bikita West (Independent), Munyaradzi Kereke said available resources fall short of what is required.
“At the moment if you tax companies and individuals 100%, you will not raise the amount ($4,4 billion),” he said, adding that overtaxing the nation was not a solution.
— The Source