Finance Minister Bwalya Ng’andu has said that it was inevitable to withdraw the sales tax Bill 2019 as various Stakeholders were opposed to it.
Dr. Ng’andu is however confident that the country will raise tangible revenues from the current value-added tax-VAT regime once the challenges associated with it are addressed.
Dr. Ng’andu also reiterated that the increase in budgetary allocation towards dismantling debts will improve the circulation of money thereby inducing the country’s economic development, adding that there is need to clean the payroll system to avoid possible expenditure on ghost workers.
The minister was speaking last evening during the post 2020 budget dinner.
At the same function Economics Association of Zambia (EAZ) past president Isaac Ngoma described the 2020 national budget as inspiring.
And Consumer Unity and Trust Society Coordinator Chenai Mukumba praised government for heeding calls to withdraw the sale tax Bill.
Yesterday, Finance Minister Bwalya Ng’andu announced that Zambia will not replace its Value Added Tax (VAT) with a non-refundable General Sales Tax.
Dr. Ng’andu said this when he presented a 106 billion kwacha budget, translating into 32.4 percent of the Gross Domestic Product.
He said government would limit Zambia’s fiscal deficit to 5.5% of GDP in 2020 from 6.5% this year.
Dr Ngandu explained that Government has decided to maintain the Value Added Tax, but that there is need to address the compliance and administrative challenges.
Dr Ngandu however said government would limit VAT claims on electricity by mining companies to 80% from 100%.
As a strategy to stimulate economic activity in the country, Dr. Ng’andu has increased allocation towards dismantling of domestic arrears to K2.3 billion in 2020 from K437 million in 2019.
He said that government will reduce borrowing from the domestic market to 1 .1 percent from 1.4 percent of the GDP.
Dr. Ng’andu has also projected to reduce the fiscal deficit to 5.5 percent from 6.5 percent of the GDP demonstrating government’s commitment to restore fiscal health and stabilize the economy.
He said government would also remove a tax on capital equipment and machinery for mines, and reduce the capital allowance claimed by mining companies for capital expenditure to 20% from 25%.
“To ensure debt is maintained within sustainable levels, the government would slow down debt accumulation, postpone or cancel some undisbursed loans and cease issuance of government guarantees,” Dr Ng’andu said.
He said government is targeting gross domestic product growth of at least 3% next year from an estimated 2% this year, after a drought affected crop production and electricity generation at hydropower plants.
And Dr. Ng’andu proposed to spend K44.1billion on General Public Services with K33.7 billion and K2.3billion going towards debt obligations and dismantling of arrears respectively.
He has maintained the budgetary allocation to education sector at K13.3billion.
Dr. Ng’andu also increased the budgetary allocation for the health sector from K8.1 billion in 2019 to K9.4billion in 2020.
He also proposed to increase the allocation towards the social cash transfer project to K1billion next year from K699.5 million in 2019.
i still don’t like him, he is fuuucking boring civil servant. Missing dramatic Maggie mweee
HH was right and yet vilified. Lubinda Habazoka was wrong, he needs to be shown the door the same way Margaret Dizzy Mwanakatwe was shown and Kingsley Chanda at ZRA needs to resign or be fired for misleading Aunty Dizzy
Blar blar blar the situation on the ground is different, poverty and hunger everywhere, no electricity high meal meal prices, fuel is up, what the hell do you taking as for you charlatans?
Let us hope the minister is allowed to proceed with the plans. Well done on keeping the education budget to K13.3 billion. Hope this is a good percentage of the whole budget so it can attract funding from the likes of the GPE. Of concern is the fact that the education budget does not go to programming; over 90% goes to Personal Emoluments. So our learners remain second from Malawi at the bottom of the rankings in SACMEQ. That is a shame and continuing disaster.
Of course it was inevitable because PF do things without thinking.
Agajn and again, this government flip flops on important national issues. HH warned them that this tax was amiss.
Infact, the permanent secretary in the ministry of finance did oppose this tax during a hearing with the parliamentary public accounts committee.
So, how much was wasted on drafting and promoting this sham of a tax proposal?
PF never seems to learn, they are all huff and puff.
Busy worshipping Supreme leader HH of the UPND…Who is HH to Zambians he’s just an ordinary person who copies what others are doing claiming he’s original when not…
Fwanya boyi insoni ebuntu. This is not the first time HH has advised you dull twits over certain issues, you call him names and then reverse them when fyapena, that’s !d!ocy and your statement confirms ulichipuba.
So this man says he made a decision based on many peoples opinion rather than an informed decision by him as chief economist of the country. My God good luck to your people living in Zambia..you have clowns for leaders
He yielded to pressure from the mines. Mines use all means including corruption to get what they want. Now we shall see how much VAT refunds he will be paying the mines every month
Can Dr Ng’andu manage his noble objectives? The danger is that he will begin to be directed very soon. I see that even the Veep has started directing, or is it only when she is acting? You see the negative impact after severe and sometimes irreversible damage has been done. And the directors simply change tune without even apologising. Meantime the ministers would have been singing the directive at every opportunity in order to be seen to be working, they can’t think on their own, but anyway they are not expected to think.
Same thing or worse in UPND, where everyone just regurgitates what the supreme leader says, whether it makes sense or nonsense, only trible matters to them.
Junior you now coming to your senses about your party. It’s even bad with your supreme visionless leader, as the person in charge he should have anticipated this plan will fail but being visionless he lacks any foresight. Next, I hope he listens to concerns about that constitution amendment let it be withdrawn, everyone in the legal field is against it, with many also following suit. That bill is bad no sugar coating it, you can’t fix it with all the useless submissions or Christian clause meant to dupe christians.
Good move on the sales tax.. the problem is you actually ignorant and stubborn.
Good move on the sales tax problem is you are ignorant and stubborn for nothing
Ok, but how much did we have to spend before heading sound advise. How many allowances got paid just to come out with nothing in the end. Congratulations for once again proving the chipantepante system of governing.