Biti calls for end to doublet-tier pricing regime to curb market distortions

HARARE East MP Tendai Biti has urged Finance minister Mthuli Ncube to remove the dual pricing system as it caused distortions on the economy as well as accounting nightmares within local industry and commerce.

Debating on the Finance Bill in the House of Assembly Thursday, Biti said the government kept repeating avoidable blunders that were bleeding taxpayers, heavily taxed to finance all illegalities created by the government.

“So, we are generating illegality upon illegality, but most importantly, we are creating distortions in the economy.

“Let us have one single pricing system. The dual pricing system is creating havoc in industry. It is creating accounting nightmares,” Biti, a former finance minister said.

“If you run a business, it means you now have two sets of accounts. One that deals with the USD economy and the other that deals with a local economy with two different tax obligations and interest implications. There is a different interest for the USD and the local dollar which does not work. It will not work.”

He went on to urge Ncube to revisit the issue of monetary policy, exchange rate and the debt issue.

The opposition leader said it was also contradictory and questionable the government chose to compensate former white farmers with US$3.5 billion when it was failing to eradicate poverty in the country.

“It is a contradiction. It does not work. I urge the esteemed Minister of Finance, Professor Mthuli Ncube of Cambridge University to revisit the issue of the Monetary Policy and the exchange rate because it is creating distortions.

“When the authorities pass a law to say there must be dual pricing in USD and in Z$ when you have not repealed Section 21, 22 and 23 of the Finance Act which this House passed as Finance Act No. 7 of 2019 on the 1st of August, 2019, that says the sole legal currency in Zimbabwe is now the Z$, then you are doing de-dollarisation through the backdoor,” Biti added.

He said workers earning salaries in RTGS were no longer earning any wages.

“A Grade E5 teacher which is most teachers, who effectively used to earn US$700 as of the 19th February 2019, a day before S.I. 33 of 2020 is now effectively earning US$15.

“It does not matter what exchange rate you are using, the $83 from the auction or the $113 from Fourth Street, your salary has effectively been devalued. Ncube devalued the salaries of civil servants including the salaries of esteemed Members in this august House.”

In response, Ncube denied his policies were creating problems insisting his interventions were a relief to taxpayers as they enhanced their disposable incomes, promoted capital accumulation, which he said was crucial in supporting the economic rebound and also to protect revenue sources.
-NewZim