Finance Minister Felix Mutati has unveiled a K64.5 billion 2017 national budget with a focus on restoring fiscal prudence while maintaining a growth path.
And Government hopes to borrow close to K20 billion to finance the budget while around 42.94 billion will be through domestic revenues and K2.23 billion through grants from Cooperating Partners.
Meanwhile, Mr Mutati has Increase the exempt threshold for PAYE from K3, 000 to K3, 300 per month and has adjusted the income bands accordingly and increase the top marginal tax rate from 35 percent to 37.5 percent for those earning above K6,200.
Mr Mutati presented the budget under the theme Restoring Fiscal Fitness for Sustained Inclusive Growth and Development.
He has also announced increase in excise duty on air time from 15 percent to 17.5 percent.
On allocation, Mr Mutati has pushed the allocation for social protection by 85 percent, to K2.7 billion in order to cushion the vulnerable.
Of that amount, K552 million for the Social Cash Transfer Scheme and K1.7 billion for the payment of pension benefits under the Public Service Pension Fund.
And Mr Mutati has announced that Government will be reviewing the performance of many State Owned Enterprises (SOEs) such as Zesco, Zamtel, Zambia National Building Society, Indeni, TAZAMA Pipeline, Zambia Railways and Zambia State Insurance Corporation in 2017.
Mr Mutati has also increased to 40 percent from 25 percent surtax on plastic carrier bags for shopping and 15 percent for both single and multiple yarn (acrylic yarn) from zero percent and 5 percent, respectively.
He said this will help stimulate local production and support Government’s efforts towards promoting local value addition and diversification.
He has also increased the specific excise duty rates on cigarettes to K240 per mille from K200 per mille and remove the ad valorem rate of 145 percent to induce a reduction in the consumption of cigarettes by increasing the price, in line with the recommendation of the World Health Organisation– Framework Convention for Tobacco Control.