The Government will soon announce more fiscal measures to create and sustain demand for ZiG as part of moves to ensure increased use and stability of the recently introduced local currency, Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube said yesterday.
Prof Ncube said this when he appeared before a joint sitting of the Portfolio Committees on Finance, Economic Development and Investment Promotion and that of Industry and Commerce.
Some of the measures that have already been put in place include the requirement that companies pay 50 percent of taxes commonly referred to as quarterly payment dates (QPDs) in local currency while new tax-free threshold for the ZiG currency has been set at ZiG1 356.
“It is Government policy that we should create demand for the local currency. In this regard, going forward, certain revenue heads in Government fees and services will be paid exclusively in ZiG, the local currency. We will explain further which of these fees and services are, but we are still working on that to make sure that we can promote the demand for the local currency,” he said.
The minister added that some of the fiscal measures would be periodically promulgated.
“Some of these measures would be propagated as we go along, we won’t have a single fiscal statement to summarise everything, no,” he said.
The minister reiterated that it was a criminal offence for any business operators to refuse to accept the ZiG, saying they were working on strengthening the RBZ’s Financial Intelligence Unit to deal with errant businesses.
Prof Ncube also said the delays in releasing the 2024 budget allocations to some ministries and Government departments were due to the changeover from the previous Zimbabwe dollar currency to the ZiG.
“The introduction of ZiG will delay release because we had a budget announced and denominated in RTGS and in April this year we announced the ZiG in the middle of the month.
“We had to reprocess the documents from RTGS and substitute those with the ZiG equivalent documents because the process has to be followed and documents have to be redone.”
The minister also ruled out the possibility of a supplementary budget erosion of the budget by changes in the exchange rate could be accounted for by the increased revenues due to inflation.
“So clearly there was an erosion of the budget but the exchange rate and inflation also cut both ways, when the exchange rate was weakening the inflation was going up and revenues were also increasing.
“The overall erosion is not as large as we may feel because revenue has been going up,” Prof Ncube said.
On coming up with a ZiG budget, the minister said they will be able to show a ZiG denominated budget next month.
“I don’t think a supplementary budget will be necessary because we should be able to live within our budget so it does not change much. We want to increase the value of ZiG, so in this regard, a supplementary budget won’t be necessary.”
The Herald
