Harare
We, the Combined Harare Residents Association (CHRA) and the Zimbabwe Taxpayers’ Platform (ZITAP), are concerned with the City of Harare’s introduction of three levies for water infrastructure, street lighting, and ambulances.
The new levies come following revelations of fiscal abuse of revenue collected by the City through unreasonably high salaries for the local authority’s executives with the surrendering of key revenue streams and mandates to private companies.
The levies introduce double taxation as we believe revenue is being collected which could pay for the purported expenditure. Particularly, we note that revenue being collected for
water rates is not being ringfenced for the service, resulting in it being open to abuse or diversion to non-priority expenditure.
We, CHRA and ZITAP, note that other sources of funding exist that could be used for infrastructure development in particular Intergovernmental Fiscal Transfers (IGFTs) commonly known as devolution funds which are mandatory under Section 301 (3) of the Constitution of Zimbabwe.
However, in the 2024 fiscal year, as of November 2024, only a meagre amount of ZIG 1.218 million equivalent to just 1.91 % of the total allocation of devolution funds was disbursed to the City of Harare for these purposes further pushing the burden on poor residents through levies.
This new layer of taxes at local government comes as Zimbabweans experience one of the
most burdensome tax regimes on the African continent with the third highest income tax after South Africa and Senegal at 41.2%.
Since 2018, the country has witnessed the introduction of a gamut of taxes, including the Intermediated Money Transfer Tax (IMTT), the sugar tax, fees on repatriation of deceased persons, and the recently proposed tax on airtime.
While the Minister of Finance, Prof. Mthuli Ncube, announced plans to cut the country’s taxes and regulatory fees for businesses within six months, the tax burden on ordinary citizens continues to mount at different tiers of government.
Considering the above, CHRA and ZITAP, recommend the following:
1. The City of Harare must stop introducing the proposed levies and prioritize expenditure from
its current revenue streams, and improve collection efficiency on existing levies, rates and tariffs.
2. The central government must stop interfering in the running of the city, including transferring revenue collection and service delivery mandates from the city to parastatals like the Zimbabwe National Water Authority (ZINWA) and private companies.
3. The central government, particularly the Ministry of Finance, must equitably share revenue raised nationally between the central government and local tiers of government for local authorities to invest in capital expenditure and infrastructure, including the 5% devolution funds mandated by Sections 298(1)(b)(i) and (ii), and 301(3) of the Constitution of Zimbabwe.
4. The proposed tax reform by the Minister of Finance should consider lessening the tax burden
on ordinary citizens.
ENDS//
For more information contact;
Mr Itai Zimunya (ZITAP Chairperson) on 0772288605
Or
Mr David Pasipanodya (CHRA Chairperson ) on 0772 422 246