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NATIONAL ASSEMBLY HANSARD 17 December 2019 46-17

                                                                 PARLIAMENT OF ZIMBABWE

Tuesday, 17th December, 2019.

The National Assembly met at a Quarter-past Two O’clock p.m.





                   THE HON. DEPUTY SPEAKER: I have to inform the House of

an error on the Order Paper, where today’s date has inadvertently been reflected as Thursday, 12th  December, 2019 instead of Tuesday, 17th December, 2019.


                 THE HON. DEPUTY SPEAKER: I also have to inform the

House that the Secretary General of the Parliament Sport Club – “The

Patriots”, is cordially inviting all paid up members of the club to the official hand-over ceremony of tracksuits donated by the Tobacco Industries Marketing Board (TIMB) on Wednesday, 18th December 2019, in the Members’ Dining Room at 1000 hours.


                   THE HON. DEPUTY SPEAKER: I have to inform the House

that on Thursday, 12th December, 2019, Parliament of Zimbabwe received a petition from Dr. S. Nyaguse, President of the Senior Hospital

Doctors’ Association, beseeching Parliament to urgently revive the health care delivery system in line with the Constitution of Zimbabwe and to enact a law establishing the Health Service Commission and disbanding the Health Service Board.

         The petition has since been referred to the Portfolio Committee on Health and Child care.


                 THE HON. DEPUTY SPEAKER: I also have to inform the

House that on Thursday, 12th December, 2019, Parliament of Zimbabwe received a petition from Mr. C. Chitsunge of the Broad Alliance Against Sanctions, beseeching Parliament to enact laws that penalise any Zimbabweans living in the country and abroad, who communicate or share material that negatively impacts on Zimbabwe.

         The petition has since been referred to the Portfolio Committees on Foreign Affairs and Justice, Legal and Parliamentary Affairs.


                        THE HON. DEPUTY SPEAKER: Further to that, I wish to

inform the House that on Thursday, 12th December, 2019, Parliament of Zimbabwe received a petition from Mr. R. Chimbiti of the Chikunda

Language and Culture Association, beseeching Parliament to amend Section 6 of the 2013 Constitution of Zimbabwe to include Chikunda as one of the officially recognised languages.

         The petition has since been referred to the Portfolio Committee on Defence, Home Affairs and Security Services.


THE HON. DEPUTY SPEAKER: I also have to inform the House that on Thursday, 12th December 2019, Parliament of Zimbabwe received two petitions from Mr. Q. Petersen of 22 Phillip Circle,

Suningdale 1, Harare:-

         Imploring Parliament to exercise its constitutional mandate to safeguard the rights of the minority Zimbabweans, particularly

“Coloured Community.”

         The petition has since been referred to the Portfolio Committee on Defence, Home Affairs and Security Services.

         Secondly, beseeching Parliament to exercise its constitutional mandate to protect the constitutionally guaranteed rights of

Zimbabweans to safe, clean and potable water, review and align laws, policies and regulation on water to the 2013 Constitution.

         The petition has since been referred to the Portfolio Committee on Lands, Agriculture, Water, Climate and Rural Resettlement.


THE HON. DEPUTY SPEAKER: I also have to inform the House that there will be a Roman Catholic Church Service tomorrow, Wednesday, 18th December, 2019, at 1230 hours in the Senate Chamber.

All Catholic and non-Catholic Members are invited.

                     HON. MUSHORIWA: Thank you Madam Speaker.  I move on a

point of privilege as per Standing Order Number 68 (d) as raised with Standing Order Number 69.  Madam Speaker, the mission of Parliament is to protect the Constitution, to make laws for the good governance and effectively represent the people as well as hold the Executive and public institutions to account.

         According to Standing Order Number 65 (2), a notice of a motion must be submitted to the Journals Office within three sitting days before it is given.  In light of that Standing Order, I gave a notice of my motion on 13th November, 2019 and by 14th November, the Assistant Clerk and

Counsel to Parliament had approved it.  By 18th November, 2019, the Clerk of Parliament had also approved it because I was actually checking with the Journals Office.

One month down line, the motion has not yet been approved by the

Speaker’s office, inspite of personal visits to the office and to the Clerk’s office to check the reason why it was delaying.  Having seen that 30 days had elapsed, I then on 13th December, 2019 did give notice in this House but shockingly, the notice did not appear on the Order Paper.

         I am aware that Standing Order Number 66 does allow the Speaker to withhold a notice of motion if he/she feels it has got derogatory or disrespectful or offensive aspects in that motion but in my view, the Speaker did not make any ruling to that effect.  I also find it difficult to understand the rationale why it is not on the Order Paper.  Now therefore, Madam Speaker, I ask whether it is now the position of Parliament that only motions that are politically correct are allowed to be moved in this august House.

         Madam Speaker, you appreciate giving a notice of motion on 13th November and is well recorded in the Journals Office, yet to date nothing has been done.  I am wondering what could be the problem because the Counsel to Parliament and Clerk of Parliament approved it.

Surely something needs to be done.  I urge you Hon. Speaker to advise accordingly.

                     THE HON. DEPUTY SPEAKER:  Hon. Mushoriwa, please

approach the Chair.

                 *HON. CHINOTIMBA:  On a point of privilege Madam Speaker,

I think we have come to a point where Parliament should do its job.  This country is now in tatters because of some people.  To be honest with you, a senior who was once a Parliamentarian left Zimbabwe and went to Germany, Britain and America to ensure that this country suffers economically. We have been quiet but it is now time that we come up with legislation with a mandatory sentence for people who go out of the country and advocate for sanctions that economically harm the nation to be arrested.    People are suffering and they are living in poverty yet they are the same people who are supposed to vote for them.  It is time that as authorities of this nation we interrogate these issues, especially countries like America.

HON. P. D. SIBANDA:  Madam Speaker it is fair to say that as

Hon. Members we should not abuse the point of privilege.

THE HON. DEPUTY SPEAKER: You are not the one who is

supposed to give a ruling on that.

HON. P. D. SIBANDA:  No, no, no this is a point of order Hon. Speaker.  We cannot allow him to continue to abuse the point of privilege.

THE HON. DEPUTY SPEAKER:  Take your seat Hon. Sibanda.

*HON. CHINOTIMBA; Madam Speaker, I think I am done with

that one.  The people of this nation are suffering.  If you go to the bus termini, the 50 cents and $1 coins are no longer acceptable.  We do not know whether this is because of sanctions or not.  So as a country we need from today to come up with legislation as MPS, which should be fast tracked by the Minister of Justice, Legal and Parliamentary Affairs which deters people from taking advantage of the coins that are used in the country.

*THE HON. DEPUTY SPEAKER:  Hon. Chinotimba, I have

heard your issue.  I will look into it and give a ruling later.

HON. P.D. SIBANDA:  Madam Speaker, my point of order is on the point of privilege raised by Hon. Chinotimba. Why I am raising the point of order is that Hon. Chinotimba is abusing the point of privilege in the following manner:

Hon. Speaker, I know that my colleague Hon. Chinotimba is referring to my leader, Hon. Chamisa – [HON. MEMBERS:  Inaudible


THE HON. DEPUTY SPEAKER:  Hon. Sibanda!  Hon.

Chinotimba, please take your seat.  Hon. Sibanda!

HON. P. D. SIBANDA:  Yes, Madam Speaker.

THE HON. DEPUTY SPEAKER:  You are assuming.  We

cannot work with assumptions.

HON. P. D. SIBANDA:  No, you cannot judge that I am assuming before you have heard me.  I think you need to hear me fully Hon.

Speaker, before you make that judgment.  I think that judgment Hon. Speaker, is a bit rushed for you to judge me and say that I am assuming before I have finished saying what I am saying.

THE HON. DEPUTY SPEAKER:  Okay, go ahead and tell us

why you think he is referring to your leader.

HON. P. D. SIBANDA:  What I want to say then Hon. Speaker, is this - it is important as Hon. Members that if there is something that you want to raise which you think is important, why not listen to the whole clip rather than choosing on a 13 seconds clip and then you want to go to town about it – [HON. MEMBERS:  Inaudible interjections.] – So I think Hon. Speaker, it is unfair because it is dishonorable and I think it is unpatriotic as well.

THE HON. DEPUTY SPEAKER:  Hon. Sibanda, we cannot

debate those issues in the House.  Please take your seat.

HON. MAVETERA:  Thank you very much Madam Speaker.  I

rise on a point of privilege.  I would like to start by first commending our First Lady, Her Excellency Hon. Auxillia  Mnangagwa, for launching yesterday an anti accident campaign.  Right now, if you look at what we are having as a country, it is that we are having a lot of accidents and for her to be taking it upon herself to be going to

Mashonaland Central yesterday, Mashonaland East, Harare Province and Mashonaland West and conscientise, especially now since we are going into the festive season, she has gone on to remind all drivers to take great care and make sure that at least they drive well.  We realise that in this country accidents have actually been one issue that has caused a lot of problems to a lot of people.  So, we would like to commend her and would like to say to every person in Zimbabwe, to make sure that since now we are going into the festive season, they should drive skillfully and that is one thing that I think we also need to do.

Madam Speaker, I also want to say that if we look at the statistics that we have, they show that a lot of accidents have been caused by human error.  Also, if you come to think of it you realise that there are even police out there who are not doing their job properly.  We would like to call upon them to say they should refrain from even negotiating to allow unroadworthy vehicles to be travelling on the roads.

 We want to say right now, since we are going into this festive season, there is great need for us to make sure that we do not have such accidents.  In this august House, Hon. Madam Speaker, over the last two weeks we have had two honourable Members who have lost their two very close relatives because of accidents.  Accidents indeed have been one of the major causes of death especially during the festive season.

Therefore, I would like to say Madam Speaker, during this festive season, let us be able to drive carefully and I would like to wish all the Zimbabweans a happy festive season.  I thank you Madam Speaker.

THE HON. DEPUTY SPEAKER:  Thank you Hon. Mavetera.

Indeed, it is very commendable what the First Lady did yesterday.

Thank you.

HON. MATEWU:  Thank you Madam Speaker.  On a point of

privilege and it is as follows:  about four weeks ago we got letters from the Ministry of Environment, Tourism and Hospitality Industry in our pigeon holes asking Hon. Members to plant trees in their constituencies.  Actually, it was asking us to plant two lots of trees.  So two weeks ago when I was performing my constitutional duty and I was actually going in line with what the Minister had said to plant trees, we were surprised that during the time we were planting trees we saw the police coming in, storming through the gates.

HON. TOGAREPI:  It is not a matter of national interest.

HON. MATEWU:  It is a privilege.  Chief Whip, can you allow me to talk please?

During the time that we were planting trees, as we approached the police to talk to them they started to fire bullets.  This put the lives of the people and the children at risk.  This was at a clinic where you have pregnant women.  The police fired bullets and tear gas and some of the people who were there were actually people with chronic diseases.  Also present was our president, His Excellency president Chamisa – [HON.

MEMBERS:  Inaudible interjections.]-

Madam Speaker, we need to ensure that State apparatus do not hinder us.

HON. CHINOTIMBA:  Madam Speaker, on a point of order

[HON. MEMBERS:  Inaudible interjections.]-

HON. MATEWU:  Madam Speaker, we need the State to protect us to ensure that we are protected when we do our constitutional duties.

Thank you – [HON. MEMBERS:  He must withdraw that.]-

THE HON. DEPUTY SPEAKER:  Hon. Member, you must withdraw where you said His Excellency Hon. Chamisa – [HON. MEMBERS:  Withdraw.]-  Chamisa is the president of your party and not the country, so you cannot say His Excellency – [HON. MEMBERS:

Inaudible interjections.]-

HON. MATEWU:  Madam Speaker, if you read your dictionary

‘excellency’ means executive powers.

THE HON. DEPUTY SPEAKER:  You must withdraw that.

HON. MATEWU:  He has executive powers in MDC.

THE HON. DEPUTY SPEAKER:  You must withdraw that, it is not allowed.

HON. MATEWU:  I cannot withdraw because I am saying what the executive – [HON. MEMBERS:  Inaudible interjections.]-

THE HON. DEPUTY SPEAKER:  You must withdraw that, it is not allowed.  You cannot say His Excellency president Chamisa in this Parliament – [HON. MEMBERS:  Inaudible interjections.] –  Hon. Member, it is very wrong for you to say that.  Please withdraw.  We cannot have two His Excellencies – never, ever! – [HON. MEMBERS:  Inaudible interjections.] – This Parliament cannot have two His Excellencies.  Hon. Members, please approach the Chair.  Hon. Member please, may you take your seat. The Hon. Member must go out since he has refused to withdraw his statement. –[HON. MEMBERS: Inaudible interjections]-

                    HON. T. MLISWA: Madam Speaker, I think it is very important

that we respect the laws of this country and titles. I will go to Google and talk about what His Excellency means. It is a high official of the State especially Ambassadors. So, I think it is wrong to refer to Cde. Chamisa as Head of State. We must know that we are learned and it is wrong for us to do that. We cannot continue because he is not Head of State neither is he an Ambassador. That is the meaning and it does not change. You have your own vocabulary and your own dictionary but not the dictionary of the world - it does not recognise Chamisa because he is not Head of State. For now, he is not Head of State. He can be Head of State and you can create your own Parliament at Harvest House and not here. –[HON. MEMBERS: Inaudible interjections]-         Some Hon. Members having stood up.

                     THE HON. DEPUTY SPEAKER: No more points of privilege

and points of order. We are wasting time. I have ruled, please take your seats.

                        HON. CHIKWINYA: Madam Speaker, with all due respect –

Hon. Mavetera referred to the First Lady as Her Excellency. You said it is unparliamentary and so she must also withdraw.

THE HON. DEPUTY SPEAKER: I did not say that and I did not

talk to you.

                    HON. CHIKWINYA: You have said Hon. Mavetera...

                  THE HON. DEPUTY SPEAKER: I did not talk to you and I did

not say that. Please may you take your seat? Do not put words into my mouth.

         HON. CHIKWINYA: Hon. Speaker, with all due respect, you have dismissed Hon. Matewu for using unparliamentary language, but Hon. Mavetera also used the same language.

                       THE HON. DEPUTY SPEAKER: Take your seat.

                 HON. CHIKWINYA: She is not denying it. It must be a fair

Parliament. I am using your own judgment and your own ruling. She is not denying it.

                     THE HON. DEPUTY SPEAKER: Take your seat, no more point

of order.

HON. CHIKWINYA: Hon. Speaker, I am not being disrespectful,

I am simply using your own words.

                 THE HON. DEPUTY SPEAKER: You are because you are

refusing what I am ordering you to do.

         HON. CHIKWINYA: I am simply using your own judgement Madam Speaker. Can you be fair to all of us? Is this now a ZANU PF Parliament?

         THE HON. DEPUTY SPEAKER: No more points of order please! May you take your seats? – [HON. MEMBERS: Inaudible


                      An Hon. Member having stood up.

                 THE HON. DEPUTY SPEAKER: Hon. Member, please take

your seat.

         HON. J. PARADZA: Tanga wambonochinja bhachi iwe Chikwinya.

                 HON. CHIKWINYA: I think I am being abused Madam Speaker.

THE HON. DEPUTY SPEAKER: Order Hon. Members. Hon.

Member, that is unparliamentary, please withdraw that.

                        HON. J. PARADZA: Thank you Madam Speaker, I identify Hon.

Chikwinya because of the kind of jacket he puts on - I withdraw. –

[HON. MEMBERS: Inaudible interjections]-

                  THE HON. DEPUTY SPEAKER: Withdraw that Hon. Member.

HON. J. PARADZA:  I withdraw Madam Speaker – [HON.

MEMBERS:  Inaudible interjections.]

THE HON. DEPUTY SPEAKER:  Order! Hon. Member please take your seat.  Why are you standing – [HON. MEMBERS:  Inaudible interjections.] – Order!  Hon. Members order.


FINANCE (No. 3) BILL [H.B. 21, 2019]

Second Order read: Second Reading: Finance (No. 3) Bill [H.B.

21, 2019].

HON. MUSHORIWA:  Thank you Madam Speaker.  I rise to make my contribution to the Finance No. 3 Bill which is before this honourable House.

Before I go into the details pertaining to this Bill, I want to raise what I call hygienic issues.  If you go to the memorandum of this Bill, I am not sure if the Hon. Minister is aware that what is contained in the memorandum and the numbering – the sequence does not add up with what is in the Bill.  It is actually very crucial because the Finance Bill’s intention is to amend several pieces of legislation.  Once the numbering is out of sync with what is contained within the Bill, it makes it very difficult for most Hon. Members to then try to tie a particular clause in this Bill to the Act which is being amended.  I am not so sure whether the Hon. Minister did look into it – for instance, if you check in the memorandum, there is Clause 6 and we do not know whether it refers to

Clause 4 or what.  There is Clause 8 – you actually see that the way this

Bill was done leaves a lot to be desired.

The second issue is to do with the other issue which I think is a bit unfair to this august House.  If you check on our Order Paper, we have got the Reserve Bank Amendment which is supposed to go for the Second Reading.  What the Hon. Minister of Finance has done, which I think is meant to make it difficult for this august House to do its function as a Parliament – almost half of this Finance Bill contains issues which relate to the RBZ.

I am also not sure why the Hon. Minister could not take this entire half and put it under the Reserve Bank Amendment Bill which is before this august House.  The reason why this has to come under the RBZ Amendment Bill is to make sure that all the processes of Parliament are applied; that the portfolio Committee on Budget and Finance have the chance to look at that Reserve Bank Amendment. Now when the Hon. Minister then tries to bring things that are supposed to go under a Reserve Bank Amendment Bill which is on the Order Paper and then he tries to smuggle into the Finance Bill – it is unfair because what it tends to do is that we are going to rush through this because remember, the Hon. Leader of the House has moved that we were going to suspend the other processes.  This is unfair and retrogressive in terms of making laws for this nation.

If you look into the Bill, you want to read this Finance Bill in conjunction with the Hon. Minister’s Budget Statement.  You also want to read it in conjunction with the Appropriation Bill which is before the House.  If you go through it, Hon. Speaker, you will find that the Hon. Minister – apart from whatever he has been telling this House in terms of what he foresees or his projection or predictions pertaining to the movement of the exchange rate, you will see that in this Finance Bill, he is projecting that the exchange rate will be somewhere around 28, rather than the people’s rate which is around 22 – let alone the interbank which is around 16.  That tells you a lot that this Bill was badly done and we will be pointing out as we go to the Committee Stage, indicating how this issue is.

The other aspect is that when the Hon. Minister presented the

Budget, he stood in this august House and boosted that they were going to reward those companies that are going to employ youths.  If you read through this Bill, you then realise that it is just a token appreciation.  It is like what Shakespear says – there are a lot of words with little meaning.  There was nothing in it that says that the Hon. Minister intends to reward those companies.  If you go through it, you will find that there is nothing – [HON. GUMBO:  What does Shakespear say?] – You want me to quote what Shakespear says – [HON. MEMBERS:  Inaudible


THE HON. DEPUTY SPEAKER:  Address the Chair Hon.

Member – [HON. MEMBERS:  Inaudible interjections.]

HON. MUSHORIWA:  The other aspect with is crucial and tells you that the Hon. Minister of Finance is not in sync with reality – we have raised before to the Hon. Minister that the Zimbabwean employee is highly taxed and there is no doubt about it.  We thought that this was something that the Hon. Minister was going to consider.

A person who is formally employed today – apart from paying

P.A.Y.E is supposed to make sure that he or she pays the 2% tax. What this then means is that if the Minister wanted to be fair to the ordinary worker of this country, the taxation rate should have been reduced by 2% because the current reality is that a Government employee who gets his or her salary – what does he or she do, she quickly takes the money either through Ecocash to Ecocash or transfer the money from the bank to Ecocash and then the next time when he/she wants to buy, they will be liable to be charged 2% - there is no balance.  Whilst we appreciate the fact that the Hon. Minister wanted to ensure that those people in the informal market contribute some sort of tax, I think that it is unfair Madam Speaker to then also punish those who are already in the formal sector.

         In the same vein Madam Speaker, there is also the question of companies.  I would have thought that the Hon. Minister was also going to reduce the Corporate Tax further by another 2% and if he was not agreeable to the 2% reduction then the Hon. Minister should have treated the 2% tax as an expense that can be considered when companies submit their tax returns.

         Madam Speaker, the other aspect that I think is also crucial is to look into the Venture Capital.  Madam Speaker, there is something amiss – the Hon. Minister projects, when he does his things as if we want to turn a leaf in terms of this economy.  However, there is a problem whenever you talk of Presidential input or Presidential scholarship and whenever the Hon. Minister then provides that there is going to be that $500 million Venture Capital that he talks about will be under the Presidential Fund.  History Madam Speaker has taught us that anything that has got ‘Presidential’, in quotes – has tended to be abused on political lines.        In my view, it is actually wrong to even have it.

Then the other aspect that I also consider unfair Madam Speaker is that the Hon. Minister tends to choose those that he wants to reward selectively.  You cannot have selectively applied policies – you know Madam Speaker that in this Finance Bill, the Hon. Minister when it comes to the 2% tax, there is selective application.  When it comes to the dolarisation, the question of the RTGs, the Zimbabwe Dollar being the official currency – you again see that there are certain companies that

are being allowed to operate outside the law.  Then you say to yourself,

‘What type of a law are we coming with when we have laws that are selectively applied?’ Then when it comes to other organisations, you will see Madam Speaker that we have been complaining in this august House that Zimbabwe has got a lot of minerals but one of the major challenges that we have is we are not making sure that we export refined or processed minerals.  We are exporting minerals in their raw form.

What does the Hon. Minister do?  Last year when he tabled his Finance Bill, he informed us that he had allowed people in platinum mining to continue exporting platinum in its raw form provided that they make commitments to build refineries.  Now he comes back again with another mineral and is now saying, ‘No, no, I am now going to exempt them as long as they make that commitment’.

The question is simple – the Hon. Minister does not come to this august House to tell us the benefits that have accrued to the nation.  What is it that we have gained by the policies that he enunciated last year before coming up with this one?  The other issue that I raised is to do with the Reserve Bank of Zimbabwe (RBZ).  All the clauses that are here, I advised you that they are actually half of the Finance Bill.

Madam Speaker, what this does is that the Hon. Minister is trying by all means to take this House for granted.  I believe that there are several issues under the Exchange Control Act and that there are other issues that have been raised in this august House severally.  For instance, Madam Speaker you will recall that people have always had a problem with the RBZ in this House.  We have the RBZ Governor who is the Chairperson of the RBZ Board.  In this Finance Bill, the Hon. Minister proposes the Monetary Policy Committee (MPC) and he then says that the MPC is independent of the Board consisting of the Governor as the Chair.

How do you have a MPC independent of the Board?  The Monetary Policy Committee is being chaired by the Governor who also happens to be the Chairperson of the RBZ Board.  How does the independence come in?  This tells you that the Hon. Minister has not been listening to what Hon. Members in this august House have been saying.  This tells me Madam Speaker that the reason why the Hon. Minister has brought the RBZ under the Finance Bill was to make sure that he takes this House for granted.  Madam Speaker, it is wrong.

Lastly Madam Speaker, we will be deliberating on some of the issues at Committee Stage.  It is my prayer Madam Speaker - [HON.

MEMBERS: Inaudible interjections.] –

THE HON. DEPUTY SPEAKER:  Order, order Hon. Members.

HON. MUSHORIWA:  It is my prayer Madam Speaker for the Hon. Minister to  truly consider and ensure that all the issues and amendments that are contained in the Finance Bill that have to do with the RBZ are brought under this Bill that is before Parliament.  I will tell you Madam Speaker that our problem with RBZ is that our Central Bank has become one of the worst performing entity in the country in terms of its key deliverables.

Primarily Madam Speaker, we are not focusing and paying attention to what we want the Central Bank to do for this country.  This is the reason why I am asking the Hon. Minister to make sure that all the things we put under the Finance Bill  that have to do with the RBZ are brought under the RBZ Amendment Bill that is already before the august



Mushoriwa, you are left with five minutes.

HON. MUSHORIWA:  Thank you Madam Speaker.  I will stop

here and wait for the Hon. Minister’s submissions.  I thank you. –

[HON. MEMBERS: Hear, hear.] –

HON. NDUNA:  Thank you so very much Madam Speaker

Ma’am and good afternoon.  Madam Speaker Ma’am, I have no problem with this Finance Amendment Bill (No. 3) in that I have institutional memory.

We had a General Laws Amendment Bill that came into the House and consequentially it amended about 144 pieces of legislation and aligned them with the Constitution.  I certainly have no challenges with the Hon. Minister bringing this one in order to amend certain sections of the Acts of Parliament – that is the first point.  So I should allay any challenges that the Hon. Minister might have in terms of phobia and in terms of the application of his duty and the methodology that he has used in sorting out the issue of his modus operandi.

                          The second issue Madam Speaker, I ask that during Committee

Stage, if the Minister is so moved by my submission, he can flight the Acts that he wants amended, if it pleases him on television and ICT gadgets so that we can be referring to them in terms of numbering, otherwise this is good.

         On page 7 (VII), where he seeks to amend the Tax Act [2306], the value of income is, I am sorry on page 8 where the value of income is attached to the years the vehicle has been utilised by any employee who would have been given that vehicle.  I make this presentation with a heavy heart because it is my thinking that for as long as the employee is using that vehicle he then at the end of the 5 year period, be given that vehicle and sold to him for zero value or pitence.  Where I come from, we have got management at Council level, whether it is a delinquent behaviour or mere mischievous behaviour, where the council officials right at employment stage and where they get that vehicle they immediately register it in their names.  I get worried Hon. Speaker when such things happen.  It is my thinking that the Tax Act is very clear and has clarity of purpose and when the legislators put across such an Act they had that idea in mind.  They conceived such a mantra in that if somebody gets employed today, gets a vehicle, they might get what they can and move on which is not right.

                 So, having conceived that idea and enshrine and embed it in the

Act, it is therefore prudent for management, especially at Chegutu Municipality to tour the line, this is where my point is. I think that you are going to find that I think it is page 8, no it is page 7 or it is on page 12 but I am done with that. Then I come to my last, point 12 on page 8, if you go to section 1(c)...

                        THE HON. DEPUTY SPEAKER: Hon. Nduna you should avoid

chosing specific pages because this is a general debate.

         HON. NDUNA: Thank you for your guidance, however, I am going to continue – [HON. MUSHORIWA: So, you are disregarding that the Madam Speaker has said.] – Thank you Madam Speaker, it says

‘any small scale gold miner as defined in the 13th Schedule, making any delivery of gold to Fidelity Printers and Refineries Private Limited, the agent of the Reserve Bank of Zimbabwe for the purchase of gold from gold producers’.  This Act seeks to observe and to also embrace the effort coming from small scale miners. It seeks to identify and also recognise that this class of people exists.

I therefore, make a clarion call Hon. Minister, to your humble office as the gold finger, the gold finger because in the military terms you are called gold finger, the money markers, to go further and recognise these small scale miners by making sure that the Mines and Minerals Minister comes here to repeal the small scale miners in the primary Act of the Mines and Minerals Act, because they are not recognised.  Even though you have gone further to propose the taxes to be lower than those for the large scale miners, but those people as it relates to the primary source document are not recognised, so you will then find that you have challenges where you will then want to identify who it is that is called small scale miner as it relates to who your agency of the Reserve Bank are going to be buying from.

As I conclude in making my submissions, I say the recognition of small scale miners is very key and I am quite elated that you have recognised them in that they have also given you a lot of gold deliveries last year much more than the large scale miners. Let us go further now to make sure that they are recognised in the primary document that seeks to empower you with ambiguous amounts of mineral wealth in the finances so that we can use what we have to get what we want Hon. Minister.  If you recognise the small scale miners you have recognised the people of Chegutu West constituency who have reposed their trust in me.  I want to thank you Madam Speaker for giving me this opportunity to fervently, efficiently, effectively and vociferously - [HON. MEMBERS: You are a mistake of ZEC.] - put across my points on these formally marginalised people of Chegutu West Constituency in particular and Zimbabwe in general.

                  THE HON. DEPUTY SPEAKER: Order, Isuzu vehicle

registration number ADA 1601is blocking other vehicles.  Please may the owner go and remove it.

                             HON. S. BANDA: Thank you very much Madam Speaker.  I just

want to add my voice to Finance Bill No. 3.  For me it shows that this Bill stipules the normal operation of the business environment.  For me the Bill affects the easy of doing business, the Bill is about confusion policies.  Why I am saying so is if you look at this Bill, it is moving from dollarisation to Zimbabwean dollars to dollarization, so there is an acceptance in this Bill that re-dollarization is occurring.

         Madam Speaker, just yesterday, in my constituency in Mt Pleasant, we were trying to use CDF funds, we had a problem.   What was the problem?  We could not get a quotation which was valid for more than

48 hours, yet there was an option where we could get one in US dollar.  So, the quotation that was in Zimbabwean dollars was valid for 48 hours yet the other one dollarised was fixed, they do not really care.  So this budget is stifling normal business growth, it is just like fighting God, you can never win.  If you go anywhere right now Madam Speaker, you ask somebody how much they are selling for, they will tell you ‘eight,’ eight what?  Is it eight RTGS? No, it is $8.  What is your price now,

‘four,’ what is your local equivalent price, you get another price.  So basically, the mindset of small business holders and business in Mt. Pleasant, the constituency which I represent has been dollarised.  A number of sections in this Finance Bill – I am prayerful that the Minister will allow both to work, otherwise if we do not do that, it does not really represent what is happening on the ground.

Madam Speaker, Hon. Mushoriwa spoke of the issue of

Monitoring Policy Committee; again, you find that the Reserve Bank Governor is there.  So there is no independence, it is like he is holding both portfolios where maybe you are trying to have ZEC on one point being an independent Commission and at the same time being a political party.  So we really need to respect the independence of those institutions and make sure that the Reserve Bank Governor is not in both of them. He should just be in one.

Madam Speaker, I look at the issue of radios and televisions; here this Bill is trying to give a decree to force everybody to watch ZBC yet even most of the Members who are here, especially most of the people in my constituency Mt. Pleasant, they rarely watch ZBC and if they do, it is normally during news time.  This Bill here is trying to force people to watch something that they do not want to watch.  Therefore, it is fighting the Constitution; it is ultra-vires the Constitution.

Madam Speaker, I want to speak of a section where they are referring to Afreximbank and the relationship with intermediate tax.  I do not know, maybe it was taken out of context, but I feel that now it is as if Afreximbank is related to intermediate transfer tax.  I think the Minister will need to look at that.

Madam Speaker, I was speaking of the issue of liquidity.  Most banks have now what we call high quality liquid assets and if they are going to fall down at the moment, depositors are not going to get their finances.  I think we are aware that at the moment, we almost have about RTGS$20 billion in circulation.  If everyone would go to the bank at the same time to withdraw their money, nobody will be able to get their money.  Equally in US$ terms, the banks will not be able to provide that.  So, this Finance Bill that we have here is not really solving that aspect, we really need our banks to be in a good state.  Yes, no bank has been closed in 2019 but I think we really need to look at the banks.

Lastly Madam Speaker, I want to speak about how this budget is not systematic.  If you look at the rates which are being quoted here when we are trying to move from ZW$ to US$; you said we should not refer to pages but it will be difficult for the Minister not to look at the correct section if I do not mention the correct page.  On page No. 5, if you look at the rates, the first one you find that it is 28.57, another one for 25, other 2 for 15 and 2 for 16.67 – there is no system, it is unsystematic Madam Speaker.  So this Bill here ends up being unsystematic and it is not only on that page, even if you turn to page Number 7, it is the same; there are three different rates which are operating.  This Finance Bill has to be relooked at if it is going to do the work that it is supposed to do. I thank you Madam Speaker.

HON. CHIKWINYA: Point of clarification.  Thank you Madam Speaker, the point of clarification is that the Appropriation Bill is denominated in US$ whilst we are dealing with a Budget in RTGS.  I want the Hon. Minister to clarify.  Are we dealing with US$ because what is on text is US$ and we are dealing with RTGS as presented in the Monetary Statement.  That is the clarification I thought he could give.



Speaker Ma’am.  I thank the two Hon. Members for their comments, questions and requests for clarification.  Starting with Hon. Mushoriwa, he refers to the clauses in the Memorandum versus what is contained in the actual Bill.  Let me say what is in the Bill and the Memorandum is just to guide Members to try to understand what the Bill is trying to do.  Some of the clauses have been amalgamated because if the issues are related, it tries to explain two clauses together because they go together.  That is what we have done and I am sure that the Member will even be clearer when we go through the Bill clause by clause, that is what we are going to do.  It will be very clear as to what the Bill is trying to do clause by clause.  He raises a question about the RBZ Amendment Bill and so on; the RBZ Amendment Bill which is before Parliament is being withdrawn and the issues that we wanted to deal with in that Bill have been inserted into the Finance Act Number 2, with respect to the issue contained in Finance Bill Number 5.  This is because these issues pertain to the use of currency and this is a finance issue; the enforcement of the use of the ZW$ and also the penalties surrounding its abuse or a lack of adherence to the mono-currency pronouncements.

Coming to the issue of the exchange rate that is an implied exchange rate projected in the Finance Bill which is different from other documents, there is no difference. There is absolute consistency in terms of the exchange rate.  There is also a comment that the Youth Employment Tax incentives is not what – it is very clear and what we set up in the Finance Bill is the rules that will be used for checking if companies have been compliant or not for it to receive the tax credit or rebate from having employed a youthful person in the company for at least a year during the year of assessment.  It is very clear; it is about the rules for how companies seek credit or rebate.

That the tax rates should be reduced, VAT should be reduced because of the 2% tax – that is exactly what we have done.  VAT has been reduced by half percent and corporate tax has been reduced by 1%.  Tax reductions are never once-off; you review every year and see what you do from year to year.  However, the tax thresholds have also been raised from 700 to 2000, which is close to the poverty datum line.  All of that is to recognise that when it comes to PAYE, Income tax, if you earn less than that you ought not to pay income tax …

Hon. Members having stood between the Hon. Minister speaking and the Chair.

THE HON. DEPUTY SPEAKER: Order Hon. Members, please

take your seats, why are you standing?

HON. PROF. M. NCUBE: On the National Venture Fund, the Hon. Member was a little bit mixed up and I can explain to them what is going on there.  There is the Presidential Entrepreneurship Programme which is very different from the National Venture Fund.  The National Venture Fund is a fund for financing all entrepreneurs, especially startups.  So it is not under the Presidential Scheme nor any presidential issue; it is just a National Venture Fund and we will be in the process of putting the structure together to make sure that the public can access these resources.  Our youth, individuals and anybody can access these resources.

Then on reference to selective rewards or operational rules for companies, I do not think this is so.  Certainly, there are neither selective rules nor rewards; absolutely not.  On the Monitoring Policy Committee, there is a claim that it is independent from the Reserve Bank but it is not independent and all that; this is global best practice. You have MPC, Monetary Policy Committee independence and all that.  This is global best practice in Monetary Policy Committee (MPC) which we are following.  This Committee is chaired by the Governor of the Reserve Bank.  If you check everywhere that is what you will find.  What you then do is to make sure that there are more independent members of the Committee than those who are employed in the Central Bank.  That ensures independence but also eventually the minutes of the Monetary Policy Committee should be produced publicly and sent out to the public.  So whilst we have the systems and the rules working well, the minutes of the MPC will be there for all to see and analyse.

I will switch on to Hon. Nduna on the usage of vehicles that perhaps is evidence of abuse and misuse, even before the vehicle is theirs - they immediately put it in their names.  Clearly, this is not in order and we will look into this issue but I thank him for raising it.  I will not repeat the constituencies that he mentioned and certainly, it is a good place to start to see if there is wider abuse of this provision.  On gold deliveries, we are very serious about supporting small scale miners who produce the bulk of our gold and must be given a lot of support for them to continue producing.  We need upscale productivity and if there is any misalignment between what you are pronouncing and the Mines and Minerals Act, again I will have a conversation with my Hon. Friend Minister Chitando to make sure there is complete alignment in our thinking regarding the best way to support this sector.

Then Hon. Banda talked about the possibility that we use both US$ and ZWL$ currencies.  No, the sole legal tender in our shops is the Zimbabwe dollar and that is very clear.  However, we are aware and more-so allow that people save in US$, that is why we have FCA accounts, under mattresses and wherever.  We have allowed the use of US$ as a savings currency.  We are aware of this and it is already happening but we need to promote the domestic currency as the sole legal tender within our borders.  We approved this together in July under Finance Bill (No. 2), 2019.

He also referred to the MPC, I dealt with this as global best practice.  There is also reference to the use of the currency whether it is

ZWL$ or US$ for the Appropriation Bill.  It is the Zimbabwe dollar and I want to be clear about that.  Then on that we are promoting ZBC through some of the clauses and forcing everyone towards ZBC, that is not our intention.  You are already watching other channels; we all do that and that is ok.  We have ZBC and other global radio stations. However, we want people to pay their fair share of taxes and not evade those taxes.

Then on liquidity he mentioned that there is ZWL$20 billion circulating on the market, and that there is systemic risks in terms of institutions coming under pressure and depositors being unable to withdraw their monies.  We do have a Deposit Protection Corporation which protects depositors funds in the event of challenges with any financial institutions and depositors will be compensated somewhat for the loss of those resources.  Also, the Central Bank is raising the capital base of banks to make sure they are able to support any withdrawals from depositors going forward.  The Central bank has also improved the regulations of these banks, there are regular onsite inspections and compliance to BIS rules in terms of Basel II at least by the banks and Central Bank.  So there is global best practice in terms of the regulation of the banking sector and risks such as the ones cited by the Hon.

Member.  They are very low in terms of probability of recurrence but if they do, this is adequately covered through depositor protection and corporation processes.  I therefore move that this Finance (No 3), 2019 Bill be read a second time Madam Speaker.  I thank you.

Motion put and agreed to.

Bill read a second time.

                Committee Stage: With leave, forthwith.


FINANCE (NO 3) BILL [H. B. 21, 2019]

House in Committee.

                 Clause 1 put and agreed to.

                 On Clause 2:

                     HON. MUSHORIWA:  Madam Chair, I just want clarification

from the Hon. Minister.  As you are aware, we now have the bank rate, so is it still necessary for us to continuously specify the need to have payments to be done in foreign currency?  You appreciate that when this started it was when there was no clarity in terms of our Zimbabwe dollar and the US$.  Remember we were coming from the 1:1 exchange rate and it was before we had come up with the inter-bank rate.  I am of the opinion that it is no longer necessary to ask companies or organisations to make payments in foreign currency.  All you need them to do is to make payment even in ZWL$ as long as they are paying it using the bank rate because at the end of the day I think it is more or less the same.  It also gives confidence to the market in terms of the inter-bank rate but once Government which is trying to push for the inter-bank rate does not have the desire to utilise the inter-bank rate most people will also shy away from it.  So I think it is prudent to simply say let the inter-bank rate prevail.

         HON. NDUNA:  I also want to ask the Minister to go further where it says, ‘requires the royalties of sale of minerals to be paid in foreign currency’. Remittances also should go on this section in that those that have been sold outside the country, the proceeds also need to be banked locally in hard currency. This is how we can grow our foreign currency reserves because what is currently happening for those that are beneficiating and value adding our PGMs, I am quite sure that they are banking outside the country and we are then rated on a Rand versus our RTGS and the like.  I ask that you use this section to enforce the remittances back home so that we get them banked in foreign currency into our local market and it should be very clear.  Thank you.



thank Hon. Mushoriwa and Hon. Nduna for their input.  On the issue of the royalties being paid in foreign currency or domestic currency, this is simple as it is about meeting your obligations as a miner in the currency in which you earn your revenues.  This is for consistency.  So their revenues are in US dollars and for the royalties, they will be paid in US dollars – this is in the currency of trade of revenues.  Actually, it is very fair that it should be done and the companies are not complaining about this because they are earning the US dollars.

         When it comes to the issue that Hon. Nduna mentions, which is important that the US dollar proceeds in terms of earnings should be banked, this is correct but we have this provision elsewhere under the Exchange Control Act already.  So we need not repeat it but we should merely enforce it and we will endeavour to enforce it.  I thank you.

         HON. MUSHORIWA: Hon. Minister, the question is not about whether or not they are receiving money in foreign currency.  What happens if I receive my money and I want to put the forex that I have received, I turn it into Zimbabwe dollar using the inter-bank rate, and then I pay my royalty using the inter-bank rate?  Surely as a country, is the fiscus or Treasury being short-changed in that respect because I actually think that there should be confidence?  If you want companies and private players to have confidence in the inter-bank, surely it should start with the Government.

                              HON. PROF. M. NCUBE: Madam Chair, we as Government

have full confidence in the inter-bank market and that is why we support it and we introduced it in the first place.  It is certainly the way to go.  Companies have neither difficulty nor objection towards meeting their obligations in the form of royalties in this case, in the currency in which they are earning their revenues. Their whole business model is built around earning revenues in foreign currency.  So they have no difficulty in meeting their royalties in foreign currency – they suffer no prejudice whatsoever.  I think the Hon. Member recognises this and there is no issue about them paying in foreign currency.  We would like them to pay in the currency of trade in which they earn their revenues which is as simple as that.  I thank you.

                       Clause 2 put and agreed to.

On Clause 3:

HON. MUSHORIWA: Madam Chair, I want to start with line No. 4 on page 4.  Generally, our definition of youth in this country has always been defined as those people that are below the age of 35.  It appears from the reading of this Bill that youth according to this Bill is someone under the age of 30 years.  The other challenge that I have is for instance, if you say the definition of an employee, you are saying that an employee excludes a trainee intern, apprentice and managerial employee.

The first thing is that, surely you cannot punish a company.  Let us assume that somebody is 28 years old and joins a company.  That youth has done his first degree and has done his masters and you want to employ that person.  He is still a youth and you want to employ him in your company as a junior manager and you then say, no because you are employing him as a junior manager, that person cannot be defined as an employee.  I thought the mischief that you wanted to deal with was that you want to reward companies for employing the youth but if you then say no, these ones because of the positions - you are simply saying no, you cannot have people that are educated.

Then if you go to lines 13,14  and 15 – it says the amount of credit deducted in terms of subsection 2 shall be calculated at a rate of $500 per month for each additional employee up to a maximum aggregate of $60 000 in any year of assessment.  What it means is that $60 000 is the ceiling but if you divide $60 000 by 12, that gives you $5 000 a month.  If you then divide $5 000 by $500, it then says that you are just limiting to ten employees.  For a company that wants to employ more youth say 11, 12, 20 or 30 ends up not benefitting and this is why I was saying that it is like a teaser. You appear as if you are giving but in reality you are not giving much.

Then the other aspect which I also want is, if you go to line No. 22, you say the credit may not be claimed before the additional employee concerned has completed 12 consecutive months in employment with the claimant or at a wage not less than $2 000 per month.  Again Hon. Minister, remember I had actually raised that you are punishing those who are over skilled and those that are highly educated but under this one, you are also punishing those who are unskilled.  Explain to me Hon. Minister, if you are coming with a policy to say you want to reward a company that is going to employ youths, what if a company is employing those youths that might have failed their ‘O’ level or ‘A’ level and they are getting salaries of $1 500 per month.  Surely, should you punish them or they should also benefit? That is why I am saying there is an anomally because you cannot then say, a wage not less than $2 000 when in actual fact you know that we do not have a minimum wage policy in this country.

Then if you go to C, the credit may not be claimed by companies, trusts or individual taxpayers engaging in trade or investment having an annual turnover in equal to exceeding the equivalent of US$1 million.  Again Hon. Minister, it is discrimination because what you are basically saying is that for the big companies that want to employ the youths they do not benefit.  So it means that the benefit is meant for a certain type of organisation and I think Hon. Minister, we cannot have a policy or a law that seems to be targeting a minute group of companies.  Because, if you say big companies – Old Mutual or other big companies, because they have annual turnover which you consider to be equivalent to more than $1 million they should not benefit, I think that is discrimination in my view.

Then you go to (d) again, you said to the extent that any credit under this exceeds the tax payable by the qualifying claimant, the Commissioner shall not refund such excesses to the taxpayer.  I actually think that Hon.

Minister, again I actually believe that if you try to look the way you had actually put this whole thing in your Budget Statement, and the manner that you are putting some limitation there.  Suppose the company’s amount is less than the amount stipulated, surely you should credit that company rather than to concentrate on that if it exceeds the amount, we will not refund.  Hon. Minister, are we serious in terms of this benefit.  If you look at the anomalies that I have raised, it is very clear that this youth employment credit has not been well thought out in terms of its application and it is not well covered in this Finance Bill.  I thank you.

         HON. NDUNA:  Thank you Madam Chair.  There are few items that have been taken by Hon. Mushoriwa, so I will not repeat.  However, what I think is very key is consideration of those that are currently employing the youth.  Hon. Minister, can it be clear that companies that are progressive in terms of engaging the youths, who are not only engaging the youths after your Act but have been engaging the youth even before need recognition.  However, in terms of tax recognition, can it be also clear that it will not be dealt with in retrospect but dealt with from the Act’s inception going forward but for those that are employing youths, it should be made clear that they need to bring out their employment books.  What this section seeks to do is to harmonise a lot of Acts in terms of registration.

         Madam Chair, what it means is that anybody who is employed needs to have a registration certificate or an identification card of some sort which is currently not happening in the informal sector.  This section seeks also to formalise the informal sector.  I say this because I come from a place where a lot of employed young men are artisanal miners and a number of them do not have birth certificates.  They do not have identification cards but I hope that because of this section we can encourage employers to get their employees registered.

         Madam Chair, I want to also go further to find out how you will adjudicate the age of somebody who does not have a birth certificate or does not have an identification card.  I ask that the Birth and

Registration Act, because of the subsistence of this Act also gets to have some enforcement. I therefore ask that you use your office Hon. Minister as a platform to make sure that we have a moratorium of some sort, for example twelve months.  This should apply for those who do not have IDs and birth certificates but are adults who have been in this country for more than ten years.  According to Section 35 up to Section 38 of the Constitution, they should be registered as citizens and get registration certificates to  make sure that the generation they sire also is registered and has IDs.

         Going further, Hon. Mushoriwa spoke about the Constitution recognising a youth to be between 18 to 35; years yours just goes to as far as 30.  I ask the Hon. Minister to align the ages with the Constitution so that anybody who is 35 years and below is called a youth.  First and foremost, before we define who has employed who, we need to define a youth as somebody who is 18 up to 35 years of age.

                       The last one Hon. Minister, I ask because you are the purse holder.

These people that we call the youths constitute 62% of the population.  By recognising those that recognise the youths you are looking into the future and you are not putting your foot wrong, if at all you are doing the right thing.  If you recognise the youth, you are recognising an agenda which says nothing about us without us.  I also want to say using this Act and this incentive that you are talking about, let us reduce the pensionable age.

         Madam Chair, let us reduce the pensionable age to 55 and they should get all their pensions.  We have seen inflationary pressures because of monies that have been eroded.  It is my clarion call and fervent view that if you can get pensionable age to be 55.  People should get their pensions at 55 and also in tandem with the goings on of the section that incentivises.  I ask that you apply this for serving employers currently who have in their organisations youths that they would have employed without first waiting for your incentive.  Recognise them but do not pay them in retrospect but pay them going forward because of what they would have done as a service to the nation.  I thank you.



Chair, again I thank Hon. Mushoriwa and Hon. Nduna for their contributions.  Coming to this youth employment credit incentive, this is an incentive, it is not punishment.  I realise that Hon. Mushoriwa kept on using a phrase like ‘why this company should be punished’.  It is not about punishment, it is an incentive.  They are getting the incentive, they are not being punished, they are not getting it because they have not met the criteria to be given that incentive.  The Hon. Members are of the opinion that the incentive is not wide enough.  It is limited to a specific size of company in terms of turnover because we have specified that in this clause.  Yes, we have to do that because large companies, typical of the means to employ whoever they want to employ can afford it, so we need to target the next little tier of companies who typically do not have the means but are making an effort to grow their businesses and when they do that, this is when we want to really apply this rebate.  We think it is fair to do so and the large companies can basically afford it.

         We also want to make sure that it is at least 12 months of employment.  What we do not want is a reward for one month or two months for temporary employment.  We want permanent employment or semi-permanent employment, so it should be at least 12 months.  We look back on that and then be able to hold the company for the full the 12 months.  We would also want to make sure the company does not first of all eject other employees, cause unemployment then employ youth, then seek a rebate or a reward on that. Also, they are not increasing the stock of employment in the country.  We want this to be additional employees. This is also critical; we want incentives that, I think that is a good thing indeed.

         Also, Government does not have unlimited resources, we have been here trying to deal with the Appropriation but we do not have unlimited resources.  So, it is important that then we obviously have to limit it so that we can afford it.  So, putting a cap is absolutely the right thing to do so that we can also stay the cost, beneficiaries but also make sure it does not erode our tax base or the revenues that we have collected.

On setting the recognition of the employee under this incentive

$2000 more or less, this is also an important thing. We want to make sure the job is also a meaningfully but also it is not too senior a job like a managerial one; neither do we want it to be a simple internship, because usually there is no sense of permanency but it should be a meaningful job so setting this floor of $2000, we think it is the right thing to do.

         Hon, Nduna, we do not want to go back in terms of rewarding these companies that have already employed the youths before the Act comes into force.  We want to face forward and only reward from the date that the Acts starts, that is when we start rewarding companies and not before. We also have a situation that perhaps we should think of rewarding companies for all their employees at the moment.   Again, we will run into this issue of -  we do not have unlimited resources, we will run out of resources if we do that, I think we should be targeted, it should be narrow but deep and impactful.  We can always review it next year if we need to make adjustments.  I will come before the House and say, you know what we need to fine tune this and that.  We are doing this for the first time, for the first year and maybe it may need some fine tuning.  For now let us restrict it in the way we have tried to do to target it and also to conserve revenue and not to load the tax revenue base.

         I have listened carefully to his contribution to this exercise and also to make sure we can make certain enforcements when it comes to birth and registration.  I will also pass this on to the responsible Ministry of Home Affairs.  

The issue around the definition of youth – look, it is an incentive.  We define the target beneficiaries as those below the age of 30. We are not trying to come up with the generic definition of what youth means, but we are targeting that again because of we need to target number 2, it is about limited resources.  It is a start when I evaluate it, I will be able to come before this House at the end of 12 months and explain how this has proceeded, has it been successful or not using certain criteria and make relevant adjustments.  I think we can start for now and make progress, evaluate and make adjustments.  I am sure there will be a lot of debate when we do the usual pre-debate retreat just before the budget for

2021 and I look forward to that debate.  I thank you.

                 HON. MUSHORIWA: I heard what the Hon. Minister is saying.

The Hon. Minister keeps on saying it is an incentive, but the point that I am raising- an incentive in my view should be an incentive to a bigger chunk of people but when you have got an incentive which is tailor made for a very small group of people, then it loses its purpose. What I thought the Hon. Minister could probably address is that when you talk of this youth employment credit, what is the mischief that you want to correct, what is that you want to deliver?

For some of us; we thought the Hon. Minister; your idea was to say no, most of our youth are spending their time out of the work place.  As for me, I looked at the youth that spend most of their time seated on the pavements in Dzivarasekwa and I thought maybe this was a type of thing that Hon. Minister you were going to try to fix. The message that I

am getting from you is that you are saying look, imperfect as it is- it is okay for us to push it as it is and we could possibly do a review. I am saying to you Hon. Minister that a company that employs people who are unskilled at Z$1 500 and $1 800 per month should not benefit,

neither should a company that employs those that are skilled that probably can become junior managerial employees should not benefit.

         I think there is a bit of unfairness in this whole thing. You do not want the word unfairness because you say it is incentive, but incentive if it is coming from the Government, surely in my view should benefit a big chunk of people, not the way I am looking at it.

                    HON. PROF. M. NCUBE: Madam Chair, once again I thank

Hon. Mushoriwa for coming back for that clarification. Again I repeat we are not correcting a wrong, the youth sitting around without jobs. I am not trying to correct that. I am trying to incentivize companies to give our youth an opportunity – that is all. It is not correcting a wrong because they are not obliged to give people jobs.  It is not as if they are violating an obligation and therefore we need to correct that wrong, that is not what we are doing. We want to incentivize and create jobs for the youths, we want to deal with unemployment – it is narrow and that is the intention. We want to make sure it works and it is targeted and large companies can afford to manage their own employment. They do not need an incentive from Government. We are targeting the missing middle; it is so called missing middle meeting tier companies.

         There is a feeling that these are few. A lot of our companies sit in that category. They are small to medium scale companies. They sit in that category and they will benefit from this tax credit and drive job creation. It is fair and it is targeted and it is not correcting a wrong. It is incentivizing opportunity for our youth, thank you.

                    THE TEMPORARY SPEAKER:  I am informing that the

Secretary General of the Parliament Sports Club, The Patriots, is saying that tracksuits will be given to paid up Members on a first come first serve basis and it is going to be tomorrow at 10:00 a.m. here at Parliament.



Chair.  Colleagues were consulting with the lawyers and everyone in the room who is a lawyer regarding some of the issues.

Coming to the issue of the choice of the age group, those 30 and below, this is actually a financial decision, Madam Chair because we are seeking to limit our financial exposure.  We do not have unlimited resources.  This is to limit our financial exposure and those below the age of 30 are part of the youth and so are those below the age of 35.

I think where we would have gone off track in terms of calling this a youth incentive is if we had included those above 35, then it would have been totally out of sync with the Constitution and other global provisions.  We are within the 35 years.  In terms of band we have chosen 30.  It is targeted but this is designed to limit our financial exposure and liability because we do not have unlimited resources.  I thank you.

Clause 3 put and agreed to.

On Clause 4:

HON. MUSHORIWA:  Thank you Madam Speaker.  Madam

Chair, the Hon. Minister in the second reading told us that the poverty datum line is around $2 000 and I want to humbly submit to the Hon.

Minister that the poverty datum line is around $4 483 050.

THE TEMPORARY SPEAKER:  Order Hon. Members, may the

Hon. Member be heard in silence.

HON. MUSHORIWA:  Having said that, Madam Chair, that the poverty datum line is around $4 483 050, not the $2 000 that the Hon. Minister alluded to in the second reading I want to argue that the tax free threshold should actually be moved from the $24 000 that the Hon.

Minister is proposing to a figure of around $54 000 which equates from $2 000 to $4 500. Hon. Chair, most of our employees in this nation are living beyond the poverty datum line. Anybody that is earning $4 500 or less is being punished in this country. To that extent, I want the Hon.

Minister to consider that.

         The second issue is that the Hon. Minister, in his second reading, refuted the argument that he is quoting different exchange rate, but this one is a clear example. If you go to page 5, around line 12 or 13 under

(a), he says in sub-paragraph (1) US$$840.00. What the Hon. Minister is trying to tell this august House is that US$840 is equivalent to Z$24 000. If what he is saying is correct, it therefore means that if you do that it tells you that the Hon. Minister is using an exchange rate of 28.57%. This is because US$840 at the prevailing bank rate at the moment, let us take the bank rate at around 16%, it should bring you an equivalent of Z$13 440.

         The mere fact that the Hon. Minister changes goal posts when it comes to the US$, it tells you that the Hon. Minister knows in his heart of hearts that the current bank rate of 16% is not the one that underpins the real budget. The real rate according to the figures that are here is

28.57% and this one is actually there in black and white and the Hon. Minister cannot claim to say it is not there. We have put US$840 – is it the same with $24 000 using the current bank rate? The answer is no. The real rate which is implied is 28.57%. We go again to line 35 under page 5. The Hon. Minister says if an employee is being paid part of his salaries in US$ and part of the money in Z$, how does the Hon. Minister want that person charged when it comes to tax. He prefers that the person should be charged as if he is earning the amount in foreign currency. I think that one is totally wrong.

         The correct position in my view is that when a person is being paid part of his money in foreign currency and part of his money in local currency, for purposes of taxation, I think the Government should be sympathetic to that employee and that employee should be charged tax in local currency rather than to convert the Z$ component into US$ and say to the employee now you have to pay your tax in US$. The best approach is to convert that US$ component into the local currency and the employee should pay it as if he/she is earning the money in Z$. I think this one needs to be relooked into because I think it will create a bit of a problem. Those are my submissions.

                       HON. NDUNA: Thank you Madam Chair. I am not a financial

guru or an expert but it is my thinking that in so far as we have a two tier system in payment of money, when you deliver your gold where part of it the percentage is paid in US$ and part of it is paid in RTGS$ converted. It is my thinking that we need to have a two tier system in terms of taxation for employees who are paid in either currency.

         If it is too difficult for the Minister to do that, he can explain how he hopes to do it. It is my thinking that if tax for US$ salaries will be 5% of gross income, let it be like that casting stone. If it is going to be RTGS$, to say for example 2% of gross income, let it be but let these be taxed using a different two tier system because of their denominations or their denominated salary schedules.  This is my thinking, otherwise if the Minister has got a different view, he is the gold finger and if he can explain to us so that we are left with no doubt in our minds that the people will get substance out of their earnings. There is certainly the reason why the employer seeks to give the incentives or salaries in different denominated salaries. There is a reason and I ask that the Minister does not take away that incentive of the employer to the employee via exchange of some denominated salary to another mode of currency. I ask that there be a two tier system. However, if there is a different view, if the Hon. learned Prof. Minister can explain so that we are left with no doubt in our minds that we are quite clear on such modus operandi. Thank you.


DEVELOPMENT (HON. PROF. NCUBE): Thank you Hon. Chair.

There are only two Hon. Members who debated. It makes it interesting. Let me start with Hon. Nduna and there is a reason why I am starting with him and I will come to Hon. Mushoriwa. The idea that we should run a two tier system if the employees are earning forex and in Z$ all for the same jobs and service - this would really complicate our lives in the tax department at ZIMRA. That is why we convert to one currency where we deem it to be US$ by converting the Z$ into US$ at the going interbank rate and then tax in US$. It just makes life easier. I just need to do one conversion and I tax the salary as if one of it is in US$.  It is just for ease of accounting if we run a track and two tier system it will just complicate our lives – accounting-wise it will be hell.

         On the issue of different exchange rate and so forth, the US$840 that Hon. Mushoriwa refers to in terms of the tax free threshold for those earning US$ is a result of a survey that we did on those organisations, institutions and companies that are paid in US$. This was found to be reasonable threshold. We did not do an exchange rate conversion at all. The $2 000 threshold limit again was a result of a survey and extensive consultation arrived at that level of the threshold for those who are earning Z$, the salaries which are denominated in Z$. So, the two are not linked through an exchange rate. What we are finding is that there is a dual set up within our economy and each has their rules and we try to find the right level of threshold for each of those compartments. The right threshold do about for taxation is RTGs2000 and US$830, the bands are then accordingly calibrated beyond that for taxation.  So there is no exchange rate conversion there at all.

         On the threshold itself, Hon. Mushoriwa says why RTGS2000, it should be RTGS4 500. As I said, again we have done a survey and we found out that this RTGS 2000 is appropriate. Also, one thing that I should never do as a policy maker of my position is to chase inflation whenever you are doing these kinds of adjustments.  If you do you might think you are chasing inflation but actually you are adding to it by trying to catch up with or trying to get ahead of it.  You should always stay behind it but also it turns out that RTGs2000 is a product of the survey that we did; we think that it is appropriate. I thank you Madam Chair.

                                HON. MUSHORIWA: Madam Chair, I am not convinced by the

Hon. Minister’s response.  When you pass this Bill into an Act, it should send a message to whoever is going to be affected by this Bill.  For you Hon. Minister to say that there has been a survey that has resulted in you saying RTGS2000 is the amount of money, I am actually putting it to you that the poverty datum line truly speaking is way beyond the RTGS2000 that your survey indicated. Our indication is that the poverty datum line is standing around RTGS4 483.50.

         The other aspect that you said, you did not link this to exchange rate. Hon. Minister, are you aware that if there is a company that has been paying RTGS24 000, that amount at the prevailing exchange rate is actually US$1 500.  So ordinarily anybody who is actually earning US$1 500 per annum and if you divide you then realise that even if you go to pre-Zim dollar era, you will find that we used to exempt when it was 1:1.  We used to say that a person who is earning US$300 a month has actually tax exemption. I do not understand how your survey was done which then told you that US$840 was actually the correct amount.

         The unintended consequences of passing such a law is to simply have companies changing and instead of paying their workers in forex they will then pay in Zimbabwean dollars.  You will then find that in terms of revenue collection as a Ministry you will have actually shot yourself in the leg.  I actually want a situation whereby if you are coming with any figure, a figure has to be related.  What is it that it relates to?  It can only relate to the exchange rate that is prevailing.  If your argument Hon. Minister was to say  - without possibly coming out to us and saying that you foresee the exchange moving and this is the reason why you had put it at a figure which is slightly quite higher, I could understand.  For you to then simply want to silence us to say that you did a survey, a survey is not sufficient.  Let us look historically; what was the amount of money that was exempt from tax prior to the 1:1 or to the conversion into the Zimbabwe dollar? Hon. Minister, I still believe that we need to change that US$840 to US$1 500 or alternatively you really need to convince us the basis of your survey.

                      HON. PROF. M. NCUBE: Thank you Madam Chair. Let me

come to the issue of a survey. This is not something we did just because we wanted to change the threshold this year.  Every year that is what we do.  Whatever we come up with, any recommendation in the budget, it is based on extensive consultations, and we consult the employment councils. We check with them and from what they are telling us, it is that companies out there are not paying the poverty datum level that the Hon. Member is suggesting the RTGs4500, they are not and this is the


         When we spoke to the employment councils, employers and right through the economy, we were finding that this RTGS2000 is what is fair as a level below which tax should not be applied.  On that issue, perhaps exemption might be incentivise to pay their employees in

Zimbabwean dollars; that is their choice.  We cannot decide for them, it is up to them to choose what currency they will use to pay their employees but the taxes will be applied accordingly where below US$840 you do not pay taxes but above that you start paying taxes.  So we did not use an exchange rate. Every year what we did is, we went to consult and survey and then we made a recommendation for Parliament to consider. That is what we have done.   So, it is RTGs 2000 and US$840 as tax free threshold. I thank you.

                       HON. NYABANI: Thank you Chair.  I have got two issues here,

the first one is - I want to get clarification from the Minister, on payment of tobacco farmers who are getting payment equivalent to exchange rate whilst gold producers are getting US dollars.  What is the position next year – [HON. MEMBERS: Inaudible interjections.] – hamusi Minister imi chimbomirai.  How is your Ministry going to rectify the circulation of money in banks since banks are not providing interest rates to depositors?

                        HON. PROF. M. NCUBE: Thank you Hon. Chair. I must first of

all say that the questions, whilst they are valid and are good questions, they do not relate to the clause at all. I want to make that very clear.  I am still happy to answer; either I can answer offline or now.  Can I carry on now?

                       THE TEMPORARY CHAIRPERSON: Not now.

                               HON. PROF. M. NCUBE: Thank you but Hon. Member, I am

very happy to have a conversation with you.

Clause 4 put and agreed to.

                       Clauses 5 to 9 put and agreed to.

                       On Clause 10:

                    HON. MUSHORIWA: Madam Chair, I want the Hon. Minister,

before I get it wrong, I seek clarity on what this amendment seeks to do, amendment No. 10, where it says any interest expenditure incurred in foreign loans.  Could you probably just do a clarification, may be my understanding of it may be wrong.

         This clause is a tax exemption interest on foreign loans.  It is to make sure that it is able to attract as much as possible foreign resources that we so require to finance the economy – that is all this is about.  You can almost treat it as a kind of tax incentive in a way.

                       Clause 10 put and agreed to.

                       Clause 11 put and agreed to.

                       On Clause 12:

                        HON. MUSHORIWA:  Hon. Chair, the question of withholding

amounts payable under the Contract State or Statutory Corporation.  I would like the Hon. Minister to clarify on (d) – any person making any delivery of grain to the GMB…; any small scale gold miner making any delivery of gold to Fidelity Printers and Refiners...  Then you go on to say that, ‘The failure by the GMB to withhold income tax from payments to persons making grain deliveries to it from 1st August, 2013 to the end of the financial year on 31st December 2019 is hereby condoned’.

                                   Hon. Chair, I have two problems.  First, is the condonation because

I actually do not believe that we should be making backward laws but should be making laws that start from now going forward.  In fact, we should be making laws coming from January 2020 moving forward.

 Then my other challenge Hon. Minister, is that I want to take that farming should be treated as a business the same way as the small scale miners.  We need to make sure that we term the informalisation of our economy.  Let us come up with policies that tend to look at bringing everybody on the formal sector, be it small scale or farming so that we do not create a – Hon. Minister, I tend to feel that we actually reward the informal way of doing things rather than rewarding those who are moving into the formal sector.  I believe that farming is a business and small scale mining is also a business.  This is the reason why we resolved not to call them ‘makorokoza’, we want to call them ‘artisanal miners.  Let us promote them from being informal but the way that we do it – when it comes to small scale miners, when they deliver their gold to Fidelity they are treated differently from the big companies.  I think it is as if we are rewarding informal rather than formalisation of this economy.

HON. PROF. M.  NCUBE:   Again, I thank the Hon. Member for

his contributions.  You see, if you look at that clause (a) to (e) – that is nothing rather than an exemption from taxes – it is a tax exemption, that

is all there is to it.

Reference to GMB is because that is a Government owned entity – that is all we are doing and this is an internal issue.  It also applies to Clause 2 where we are saying that we are exempting GMB.  You know that if we were to say to them, ‘Look, you owe Government as GMB so much in withholding tax’, it is us as Government actually who have to pay that tax to ourselves – that is what will happen there because we fund GMB and we set a sub-budget every year for it.  So this really is about tax exemptions for GMB, the small scale miners and the others who have been defined from (a) to (e) – that is all there is to it.

Clause 12 put and agreed to.

On Clause 13:


interjections] - Hon. Members in this august House should not punish those Members of Parliament who have taken time to read this Bill.

They do not have the Bill, so they should allow us to debate. - [HON.

MEMBERS: Inaudible interjections] –



HON. MUSHORIWA:  Amendment of Third Schedule, if we go

under sub-section (B) (II) which says, ‘Business ordinarily carried on by financial institutions;

I think Hon. Minister, what I would want you to do here is to clarify.  How do you define business ordinarily carried on by financial institutions?  More so given the fact that financial institutions lend to building societies, do mortgages, infrastructure and a lot of other things.

Now when you say, ‘ordinarily’, how are you defining that?

Then on (d) you say, ‘the recipient is or proposes to be active in agriculture, mining, manufacturing, tourism or other aspects of the economy deemed by the Minister by statutory instrument to be critical for national development.’  Again Hon. Minister, we have always complained that we cannot continue to have this country being governed and run by Statutory Instruments.  Why should there be a Statutory Instrument?  As far as we are concerned, areas that are critical for national development should well be known and when an issue is well known, those are the issues that you contain in your Budget Statement.  So I do not understand why we should leave you with room to come up with another Statutory Instrument.  If you want to bring them on board, you should just have brought them within this Act of Parliament – that is what I believe.

The last point is on (b) with effect from the 1st November, 2019,’ where you say (o) by the deletion of “one thousand dollars” and the substitution of “five thousand dollars (or three hundred and twenty United States dollars if the recipient is remunerated with foreign currency …’

I want to ask you Hon. Minister, do you want to confirm that on this one, you are now using the prevailing exchange rate and if it is so, which prevailing exchange rate did you use for you to have that conversion because we want to know whether this one is based on survey, on the prevailing exchange rate or the preferred exchange rate that your Ministry wants to come up with.  What we want to do Hon. Minister is that the Bill should actually talk of an exchange rate that is understandable – that people can relate to.  When you were changing the figures, which exchange rate were you implying?

HON. PROF. M.  NCUBE:  Thank you very much Madam Chair

and again, I thank Hon. Mushoriwa for his contributions.  You see, this clause pertains to exemptions from income tax – how does a Venture Fund access these exemptions?  What makes them eligible?  Now two things – [HON. SIKHALA:  Inaudible interjection.] – Yes to stay young, it is a good idea.  Two things – [Laughter.] – Madam Chair, I cannot avoid laughing.

Hon. Chair on a very serious note, Hon. Mushoriwa raises an issue under (B) (II) that businesses ordinarily carried on by financial institutions are excluded from enjoying this tax exemption.  This is very deliberate.  This budget is about supporting productivity.  It is about supporting the real sector.  We want to make sure that this venture funds support the real sectors of the economy.  That is why we are excluding the financial services. The same answer applies to (d) where we have said it is about agriculture, mining, manufacturing, tourism or other aspects of the economy that we think again support this motion of the resector productivity, gross and job creation.  This is in order and it is consistent with that banter.

The Hon. Members goes on about the exchange rate and so forth.  This again is a result of consultations out there.  We consult, we do not seek to use the interbank rate when on some of these decisions, it is best to consult and find the right level at which we should apply our incentives or rules in Zimbabwean dollars versus US dollars.  That is what we did on this occasion.

Clause 13 put and agreed to.

On Clause 14:

HON. MUSHORIWA:  On amendment 14, my query rests on (b).

It says, “tangible or intangible property in the form of computer software as defined in paragraph (i) of the 4th Schedule that is acquired, developed or used by a tax payer in connection with his or her mining operations”.  My question to you Hon. Minister is – why are you restricting this one to mining operations?  What about other sectors of the economy?  What about those ones in transport or other types of industries?  I just want to understand why you are targeting the only ones under the mining operations and why are you not having this to cascade to all sectors of the economy.

HON. PROF. M. NCUBE: In our long and deep discussions with the mining sector, this was found to be an issue and no other sector raised this conundrum.  After our internal deliberations, we felt that we ought to put this issue under the list of items that are tax deductable or allowable.  We think it is in order to support the mining sector as a productive sector by allowing these tangibles and intangibles around this computer software as tax deductable items.  There is nothing wrong with that.  It is a tax incentive.  They pushed hard for it.  No one else did other than the sector. If other sectors also wish to have the same incentive, they should have expressed it because we consulted the retail sector and manufacturing sector and that issue did not come up in those sectors.  Only the mining sector raised it and we thought that it is something that we should follow through and give them that incentive.

HON. MUSHORIWA:  I hear what the Hon. Minister has said.  Are you therefore telling us that if the mining sector raised this – because the others did not raise it, then it is alright to grant that to the mining sectors?  Part of my problem with granting it to the mining at the exclusion of other economic sectors is that I tend to see that progressively your Finance Bills tend to favour mining operations.  You see that even when it comes to the question of royalties, there is this progressive giving leeway to the mining operations.  More-so, in my view, I actually think that most mining operations are not paying sufficient tax.  Most of these mining operations in this country are not even giving resources to the local community.  I think that what we own are our minerals.  In other countries they simply say – our minerals, our land is our contribution as a Government.  When the miner comes to do the mining, he or she should actually do - firstly look at uplifting the community and secondly pay sufficient resources to the fiscus.

In our case, we tend to do the opposite and we tend to allow mining operations a free rider. If we are going to come up with a policy, let it cascade to all sectors of the economy.  This selective application – I am not convinced it is the correct thing.

HON. PROF. M. NCUBE:  This is not selective application of incentives.  Other sectors have their incentives as well.  We can spent a lot of time talking about the incentives that we are giving to the tourism, manufacturing and industry.  Every sector has its own incentives in the form of other rebates or tax deductable allowances and all of that.  This is evenly spread around, so there is no issue of favouritism of the sector.

We have been very clear that the mining sector is a key sector and I think that we all agree that Zimbabwe has so many minerals and we desire to have those minerals exploited to the benefit of Zimbabweans but the investors also want to earn a fair return and why not?  That the mining sector is not paying enough taxes – again you know we benefit a lot from foreign direct investment from the jobs that the mining sector creates.  We benefit a lot from the exports and forex that the mining sector generates.  The mining sector is the largest generator of foreign currency into Zimbabwe, showing we ought to recognise that this is an important sector for driving our exports.

Any incentives are welcome for the sector because it will create jobs and also drive our forex earnings.  There is no bias but these are incentives and a lot of other sectors are receiving incentives in different types of incentives.

HON. MUSHORIWA:  I just need clarification from the Hon.

Minister –[HON. SIKHALA:  Kana musingadi kudebator shut up!] – 

- [HON. MEMBERS: Inaudible interjections!] –

                    THE TEMPORARYCHAIRPERSON: Hon. Sikhala, may you

please withdraw - [HON. MEMBERS: Inaudible interjections!] –         HON. SIKHALA:  I withdraw Madam Chair - [Laughter] –      HON. MUSHORIWA: I just want clarification from the Hon.

Minister.   Hon. Minister, on 15 (ii) you said there is exemption on Africa Export and Import Bank.  I may understand why you want it but why should you mention it alone?  What about the other developmental banks whether the ADB, World Bank or any other bank for that instance – why are you focussing on Africa Export and Import Bank?  Is there any reason that puts it aside compared to other developmental banks?

                          HON. PROF. M. NCUBE:  At the moment, Africa Export and

Import Bank transactions were being charged the 2% tax – Intermediate Money Transfer Tax but the other institutions which you have equivalent standing within the country are not being charged. So the World Bank, AFDB and others are not being charged and they rank pari passu with the Afreximbank as international organisations.  We need to make sure that Afreximbank is not excluded in that exemption, that is why we have been very specific about it.  For some reason, I do not know why they were paying this 2% tax, I thought initially they were exempted.  We all thought that, then we thought they are not but let us just make sure, for avoidance of doubt we make it clear that they be exempted.  I thank you.

Clauses 16 to 18 put and agreed to.

On Clause 19:

HON. MUSHORIWA: Thank you Madam Chair.  This one is a

matter close to my heart.  You recall last year that we passed a similar clause under the Finance Bill where the Hon. Minister came to this august House and made a clause similar pertaining to platinum.  Now he has come back with lithium.  Hon. Chair, my view is simple; I strongly believe that it is wrong to allow these mining operations to continue to export raw materials and we allow them simply because they have given us an undertaking that they are going come up with a refinery in so many years and the like.  The Hon. Minister should be in a position to explain to us what happened to platinum for instance, we gave a nod - what is the progress that has been made so far?  We actually believe that mining operations Madam Chair, are taking advantage.  I do not think these provisions exist in other countries where we compete with.  Look at Botswana and South Africa for instance, they do not get all these benefits. I wonder why the Minister is so soft when it comes to these mining operators.


being soft on the mining sector or favouring it.  You know, we are trying to promote investment in the sector and incentivise the sector.  We are trying to grow our export earnings in the sector. Really, we do not want the tax to be an impediment towards that kind of investment.  We want to make sure that the investment flows in; it is our desire that we have an investment of US$500 million equivalent between now and the year 2023 in the lithium sector. We believe that through these tax incentives in the form of a tax exemption is one way to attract investment.  Imagine if you say to a new investor – this is a new area by the way unlike platinum which is now an old area in terms of minerals.  Lithium is a new area; if you say to them, look, you cannot invest if you are not going to build a battery manufacturing factory which is full beneficiation, it then takes a while for investors to digest all of that and make the right skills available for that to be the case.  We feel that if we leave it like that at this stage; have this tax exemption, that is a major investment for investment into the lithium sector.  I thank you.

Clause 19 put and agreed to.

On Clause 20:

HON. MUSHORIWA: I want the Hon. Minister again to clarify to me the necessity of the new provision.  Does the Hon. Minister want to tell us that this is a DSTV Clause and if so, what is the mischief that you want to correct?  I want to understand why we are doing that; why are we saying that certain imported services deemed to be locally provided – are we saying that the DSTV the Multichoice, you want it to be deemed as if it is local or am I understanding it differently?  Maybe the Hon. Minister can probably help me there.


foreign, but the consumption is local and we want to make sure that a fair share of taxes on the consumption of these services is paid.  So this is to make sure that on the ground there is full payment and fair payment of the taxes for a service that is foreign but consumed locally.  There is nothing wrong with that, we think that this is absolutely fair, it is not targeting anyone.  It could be DSTV today, it could be something else tomorrow – there used to be Kwese as well, there could be another service so it is not targeting a specific company but this is generic and it

is fair.

HON. MUSHORIWA: One question Hon. Minister, are we

therefore saying – what form of taxation are we talking of, are they going to pay because remember the payments are made in forex.  Is the tax going to be in forex or in local currency?  Remember, somewhere, you then say that those who are earning foreign currency have to pay their tax in forex.  This is why I needed a clarification, what are we saying in regard to this issue?

HON. PROF. M. NCUBE: The recipients of the service are paying for their services in ZW$ and therefore their taxes is going to be in ZW$.

Clause 20 as amended put and agreed to.

On Clause 21:

Hon. Mushoriwa having stood up.

THE TEMPORARY CHAIRPERSON: I had already put the

question and said no objection.

HON. MUSHORIWA: No, but there was…


already passed that, we are now on Section 22.




HON. MUSHORIWA: But we said ‘objection,’ Madam Chair.

THE TEMPORARY CHAIRPERSON: Did you say objection

then I put a question?

HON. MUSHORIWA: No, but I think this one is actually important, this is an important…

THE TEMPORARY CHAIRPERSON: No, look, I had already

said – when I said ‘objection,’ if you had objected then we put a question.  You never responded on the objection.

HON. MUSHORIWA: No, we did Madam Chair.  We just want the Hon. Minister to explain because…


Mushoriwa, unless you have got an objection.

HON. MUSHORIWA: No, that is what we said, we said, we


THE TEMPORARY CHAIRPERSON: Did you say ‘I object’?




HON. MUSHORIWA: No, maybe you did not hear me.


HON. MUSHORIWA: I said I object and I stood up.  I also do not understand Hon. Chair…

THE TEMPORARY CHAIRPERSON: I think it is a matter of


HON. MUSHORIWA: No, but Hon. Chair, you lose nothing, the

Hon. Minister…


HON. MUSHORIWA: What I simply want is; this one says they are backdating up to the 1st January, 2017.  Generally, Hon. Minister, this is not a good law, why do we have to backdate.  Why do we not just start now or start in January, 2020.  What is it that you want to correct that has to be backdated to 2 years back?

HON. BITI: The rule of law requires that there should be certainty on laws.  The rule of law means that you cannot be penalised for having committed a crime that was not a crime at the time that you committed an act.  You are putting on a nice cream and red dress, it will be a travesty of justice if two years later, someone were to pass a law that says anyone who was putting on a red and cream dress on 17th December, 2019 commits an offence.  The problem with this provision is, it is seeking to retrospectively impose a tax from 1st January 2017.  That is bad law, it offends the rule of law. So, we would like the Minister of Finance and Economic Development to withdraw that and let the tax be introspective.  I thank you Madam Chair.

                   THE TEMPORARY CHAIRPERSON:  We are going to defer

Section 21 and we will come back to it.

                       Clause 22 put and agreed to.

                       On Clause 23:

         HON. BITI:  Madam Chair, I apologise for not being here at the beginning of the second reading of the Bill.  I have a problem with the tone of this Bill, the Finance Bill of 2019.  Three-quarters of this Bill, including the provision before you Ma’am, Section 23 seeks to oblige the tax payer to pay whether it is capital gains or VAT to pay in foreign currency.

My problem Madam Chair is that if we are going to oblige the citizen to pay everything in US dollars, then we are acknowledging that we are not ready for the de-dollarisation of the regime of multiple currency.  The problem we are going to create Madam Chair is that we are going to have a stream of revenues.  Now, virtually I would say a third of all Government revenues is going to be collected in US dollars or in multiple currencies.  This imposes a certain fiscal matrix.  It means that we now need two budgets. One expressed in US dollars and the other expressed in the local currency, the Zimbabwe dollar because there are now two different parallel system streams of revenue collection.

Madam Chair, if we are going to be true to the provisions of

Section 305 of the Constitution of Zimbabwe which says the Minister of

Finance and Economic Development must present estimates of revenue and expenditure, it means that the Minister must come with two Blue Books, one expressed in US dollars and the other expressed in the local currency because there are two different revenue sheets.  It is a nightmare for accountants, business people and ordinary citizens, the ordinary wananchi.    Hon. Chair, I would submit that we must make up our minds on what currency we want to use because we cannot reprobate and approbate; we cannot have our cake and eat it at the same time.  Is it US dollars or it is the regime of multiple currency?  That is the problem that I have with Section 23 and with three-quarters of this Bill, they attempt to sneak the US dollar through the back door.  In Shona we say, if you decide to eat a dog, eat the biggest one.  Here we do not know whether we are eating a puppy or a small one.  I thank you Madam Chair



DEVELOPMENT (HON. PROF. M. NCUBE):  Thank you. I thank

Hon. Biti for his comments and I can assure him that in this Bill we are going to eat the biggest dog; it is our time to eat the biggest dog.  Clause 23 actually seeks to reinforce the declaration of receipts of income from sale of assets in Zimbabwe dollars, so in a sense by deeming that, your refusal to disclose that you received Zimbabwe dollars means actually you are hiding that.  In fact, you must have received US dollars so we want to make sure that you pay in that currency of trade – [HON. BITI:  Inaudible interjections.] – No, no. We are very clear.  Otherwise why hide Madam Chair?  Why would you claim that you received Zimbabwe dollars and then you do not confirm that it was Zimbabwe dollars?  We want to make sure you confirm that it was Zimbabwe dollars and show proof and you pay tax accordingly in Zimbabwe dollars.  Otherwise we will assume you are breaking the law and you want to make sure that you escape and pay in Zimbabwe dollars when in fact you received US dollars.  So, we want to make sure that the practice stops.  It is very simple.  This is reinforcing the use of the Zimbabwe dollar in the payment of taxes.  I thank you.

                        HON. BITI:  This Bill, we have been going through every clause.

As I said before, three-quarters of it is the Government seeking to

enforce payment of taxes in US dollars.  If that is the case, why should we pretend that the US dollar is not alive and kicking in our economy?  Why should we not simply repeal Statutory Instrument 142 of 2019 and allow the two currencies to operate together; the US dollar and the exchange rate?  That way Madam Chair, the rate will force it to come down because the true exchange rate in Fourth Street will find a natural balance.  Now because we are operating nocturnally, the rate goes up due to the fact that everyone is hiding money in every part of his or her geography and the parallel market is spared.  Let us confront the elephant in the living room and it is our mismanagement of monetary policy.  The country is not ready for the de-monetisation of regime of multiple currency, so let us continue with the two streams of currencies; the US dollar and the Zimbabwean dollar.  I thank you Madam Chair.

HON. MUSHORIWA:  Madam Chair, I also want to add my view.  The Hon. Minister earlier when we were talking again in terms of the payments in foreign currency about the $840, his argument was to say, it will be cumbersome and will create a lot of work for the accountants. In this case, the valuation if you are going to then say you want to charge the capital gains tax in forex, it means there should be evaluators who should bring the valuation in foreign currency.  That is inconsistence; at one time you say no if we do this we are giving a lot of work to our accountants to do the calculations but in this case, where it fits the Government it is okay to then allow the extra work to happen.  This is my call to also simply say if we are doing the Zimbabwe dollar, let us simply say people pay in Zimbabwe dollar.


DEVELOPMENT (HON. PROF. M. NCUBE):  Again I thank Hon.

Mushoriwa and Hon. Biti for their – Hon. Biti listen you cannot be playing on your phone, “uri kutamba nephone tereraHanditi ndange ndakaterera inini uchitaura, so teerera.” Wakatarisa pasi. No, I am teasing him Hon. Chair, it is not meant to be hostile. You know Hon. Biti, the contents you were making are very generic and are about the credibility or lack of it, of the monetary system. You are not speaking directly to this clause. This is a compliance clause. It is a simple compliance clause, that is all. You are supposed to comply but if you do not and you refuse to comply, then you are going to do the following - very simple and again it is simple Hon. Mushoriwa. We are saying the default position will be US$ if you do not tell or confirm to us your transaction was in Z$ when you seek to hide that and do not show us proof. We assume to hide that and therefore breaking the law and we redeem it in US$ and request our taxes accordingly. This is very simple.

         HON. BITI: Madam Chair, if you look at Section 23, it says in respect of any sale of a specified asset that is purported to have been sold for ZWL, it shall be presumed that the specified asset was paid for in foreign currency in the US$ market valuation unless the seller provides documentary proof satisfactory to the Commissioner and the specified asset in question was sold for in ZWL. The presumption there Madam Speaker, does not start from saying you sold the asset in ZWL. The presumption starts from a mindset of guilt. You are guilty already and therefore, you must pay in US$. This provision must be reworded by saying which is the normal thing; “the seller must prove that he sold the asset in ZWL. Where the seller however fails to provide evidence that he sold the asset in ZWL, that is where the presumption should start”. This in law Madam Chair is called a reverse onus provision. So the onus is shifted to the taxpayer when the onus should be on the tax collector to say my friend I am not happy with the information you have provided because Madam Chair, section 50 of the Constitution of Zimbabwe says,

‘you are presumed innocent until proven guilty’. Here you are guilty until you prove yourself innocent. So there is something structurally wrong with this from a drafting point of view, which is why I was asking for the learned ears of the learned Minister of Justice. I thank you.

                        HON. PROF. M. NCUBE: Hon. Chair, that is just a sentence

construction issue. The effect of the clause is exactly the same. It could be stated in the way that the Hon. learned member has stated it or the way we have put it across. The impact and the effect is exactly the same. Nothing changes as far as the liability to the taxpayer is concerned if they seek to hide the fact that they sold their property in US$ but tell us that it is ZWL and do not show proof. So then we will assume it was US$, otherwise why hide and we will demand that they pay their capital gains tax in US$. The effect is exactly the same. The wording maybe different and I respectfully request that we accept it as it is and move on.

         HON. TSUNGA: It does not look like there is consensus and agreement on this one and from what I have been hearing, I would suggest as with Clause 21 that we defer this clause because in any case we may then attend to it together with Clause 21 at the appropriate time.

I suggest deferment.

                   THE TEMPORARY CHAIRPERSON: I do not know what

exactly you would want the Minister to clarify because as for Clause 21 the reasons we have had to defer it is because there are consultations that are actually taking place now. For this one, I would really want to know why you say it needs a deferment whilst the Hon. Minister is saying he has already responded to it.

         HON. TSUNGA: I think for the same reasons, there is concurrence that the wording might be changed and it does not look like the Minister is in dispute. As we look at the clause with the drafters, I think it will allow for refinement of the clause even thought the context is by and large the same.

                 THE TEMPORARY CHAIRPERSON: But would you really

agree with what I said that they are actually two instances which are quite different here. On 21, it needed consultation and on 23 the Minister has said it is okay as it is. You might phrase it the way you want but all is the same. That is where we are at the moment. So when you look at these two instances, I believe they are quite different in that in one there is no consultation which is needed and if you look at it, it is quite clear according to what the Minister has said.

HON. TSUNGA: I have acceded to the fact that the context is generally agreed to but the wording there is contestation and as I see it, already there is consultation going on in the background in regard to the same clause. If you could allow those consultations to be done then it can be helpful unless if the Minister is adamant that we continue in its form but this is what I thought in the interest of all.

HON. PROF. M. NCUBE: I thank the Hon. Member. He says

that there is consultation. I am sitting there and I am not consulting anyone. There is no consultation. There are some legal minds that are having a wonderful time at the back. I do not even know what they are talking about and I cannot hear them but I am sure they are enjoying themselves intensely. I propose that we proceed Madam Chair.

HON. MUSHORIWA: I want to restate that whenever we come up with a law, we should make sure that at least we come from a positive perspective rather than from a negative point of view. Hon. Minister, you lose nothing if what you say that it is just a question of semantics; if you think that is just the words that are interplayed you lose also nothing to just change them because I think that will be the proper thing. Let us start from a basis that any taxpayer is compliant. let us just start from that route because we do not want to start from the route to say a taxpayer is not compliant because he sold his house, car or that and so he should have sold in foreign currency. Why do we not start from a positive point of view to simply give the benefit of doubt to the taxpayer to say he or she complied with the law? I think that is a positive thing. All the laws start from that angle. Are we now starting from a negative perspective? It appears as if we are simply saying every taxpayer is not compliant and they should be hit by a hammer.

HON. PROF. M. NCUBE: The tone of this paragraph is not negative at all. In fact, if the Hon. Members were to read the entire Finance Act they will find that it does not make a difference and it emphasizes the need to pay your taxes in ZWL.  This insertion is mainly saying that if you do not comply with that and then you hide the income that you have earned in USD and you claim it is ZWL when it is not then we will ask you to pay in USD, but you are hiding that information.  So this is a deemed provision in the Act.  However, the Act is always positive, I do not know where you got this impression that this paragraph defines how the entire tone of the Act, absolutely not – the impact is exactly the same.  I propose that we proceed.

                       Clause 23 put and agreed to.

                       On Clause 24:

                   HON. MUSHORIWA: Madam Chair, in paragraph sub (1) where

the Bill says that they will have to use the selling rate, I actually think that it is being punitive.  Ordinarily, Hon. Minister, the best rate to use should be the buying rate and if you are not happy with the buying rate then you need to look for the mid rate between the buying and the selling.   To simply come and say the rate of exchange on conversion should be based on the selling rate, I think it is not right.  I believe that the best that you can do, the compromise there should actually be the mid-rate.  I think that has always been the case rather than to use the selling rate. It is as if you are looking at a punitive approach rather than the proper way of collecting taxes.  Normally, we have known that the customs have always charged the mid-rate between the buying rate and

the selling rate.

         HON. BITI: Madam Chair, we have a very problematic provision. We have got the law, we have got Statutory Instrument 33 of 2019, which codified the Reserve Bank Governor’s Monetary Policy

Statement of the 20th February 2019, that Statutory Instrument sets an exchange rate which initially was 1:2,5 which then become the interbank exchange rate  and that is SI 33 of 2019 defines an interbank exchange rate.  The interbank exchange rate is the official exchange rate in Zimbabwe, it is not Fourth Street.   The interbank rate is the official exchange rate in this country, it is the rate in which an individual like you and me can go and sell our foreign currency at the bank.

Now, what this provision seeks to do is to introduce another exchange rate which is in the discretion of the Commissioner General, it is a dog’s breakfast. It is feja feja economics.  The law Section 116 (a) must relate to the interbank exchange rate, so the Commissioner   should not have discretion, this provision should simply say when a good has been brought into the country which was bought in USD or Rands, the interbank exchange rate at the time that the clearance form is filled is the one that applies.

If you leave it like that, you are just allowing the chaos that is arising out of an operation of multiple regime of exchange rate.  We have one exchange rate in this country which is the interbank exchange rate, codified in SI 33 of 2019 which was later incorporated in the Finance Act Number 2 of 2019 which this august House adopted in August of 2019.  I thank you.

                   HON. PROF. M. NCUBE: Thank you for allowing me to

respond.  I just want to thank Hon. Members for raising the issues that they raised.  Let me deal with this issue of the mid rate that Hon. Mushoriwa raised.  You buy your currency at the selling rate; the conversion from the foreign currency ZWL is at the selling rate that is why you are referencing the selling rate.  When you buy your currency, you use the selling rate that is why you are referencing that.

         Now, on the issue of the Customs Exchange Rate; it is always benchmarked on the interbank rate.  So there is no deviation from that but we would want to make sure that those who also would have bought their currency elsewhere, other than in the formal market, that customs rate is able to accommodate them accordingly.  So, we want to make sure that that happens, hence we referred to Customs Exchange Rate - but the guiding exchange rate is always interbank rate.  The selling rate is the rate at which you would buy the foreign currency at which you would convert foreign currency to Zimbabwe dollars that is why we have worded it like that.

                  HON. MUSHORIWA: Hon. Chair, with all due respect to the

Hon. Minister; we cannot leave this House and say that there is going to be a customs exchange rate.  Let us be clear, it has to be the bank rate.

We should never leave things to the discretion of the commissioner.  Remember Hon. Minister, previously we used to have this; it goes back to what I was saying earlier that we seem as a Government not to have confidence with interbank rate.  If we have got confidence with interbank rate, surely we should just simply state, it does not kill, at prevailing bank rate - remove the Customs Exchange Rate, and just simply say at the prevailing bank rate.

I will concede to selling rate that you referred to, to say let it be the selling rate but let it be the selling bank rate not the customs rate.  The moment you leave; what if the Commissioner General decides to say the customs exchange rate for today because Mushoriwa is importing his goods, he then uses an exchange rate of 10 and tomorrow because Hon. Sithole is importing his goods, he then uses an exchange rate of 20, then the customs exchange rate - I do not think we can allow that to happen.

If we have got confidence in the bank rate, let us use the bank rate unless Hon. Minister you are basically telling us that as a Government, we do not have confidence with bank rates.

         HON. TSUNGA: Just to buttress what Hon. Mushoriwa has just said.  The provision that the Commissioner in consultation with the

Reserve Bank does not help matters at all because it is only consultation.  When one consults, they are seeking the views of others.  It is not the direction of the Reserve Bank but simply consulting.  I can consult and hear your views but not necessarily take them.  So I think the work consultation is misplaced.  If it is as directed by the Reserve Bank, it makes better sense if you still insist on Reserve Bank, but consultation - they may consult but not take the views.  So, look at that more closely and do the necessary adjustments.  I thank you.

         HON. BITI: The whole purpose of law and policy is certainty. The whole purpose of law and policy is to mitigate the life of a citizen, is to make the life of a citizen soft and mitigated and accommodated.  If you have a law Madam Speaker that applies differently to different people to different classes, it is not a law.  A law according to the founders of positivist jurisprudence, people like John Bentham and Thomas Aquinas, the law is something that is fixed, something that is certain, something that is predictable and applies to everyone.  What this provision seeks to do is to introduce another exchange rate.

We have the exchange rate which we know exists, which is the inter-bank exchange rate which is already there by operation of law.  If you go to Statutory Instrument 33 of 2019, it defines what the inter-bank exchange rate is.  We all know it.  In the past few months, it has been floating around 1 is to 15.  This law now seeks to introduce another exchange rate which Section 115 A, if you look at the last line described as a customs exchange rate.  So we now have a customs exchange rate, an inter-bank exchange rate, a fourth street exchange rate – why are we doing that? Why are we creating uncertainty and why is the Minister of Finance and Economic Development, the one person creating these various pockets of distortion and confusion?  It is not good law and it is not good policy.  Just substitute customs exchange rate with inter-bank exchange rate because everyone knows what that is and if there is any doubt, you ask the Reserve Bank to define for you on that particular day the existing inter-bank rate.  I thank you Mr. Chairman Sir.



Chair and again I thank the Hon. Members Biti and Hon. Mushoriwa for their contributions.  If you read that clause, it says these customs exchange rate will be a rate determined in consultation with the Reserve Bank of Zimbabwe.  The rate that the Reserve Bank will advise the Commissioner on is the market rate which is the inter-bank rate.  So there is no inconsistency at all.

         HON. MUSHORIWA: Mr. Chair, I think the Hon. Minister is not being fair.  Can he answer the question – why are you running away from saying interbank rate because that is the question?  Unless Hon. Minister you are just telling us that you do not have confidence with the inter-bank rate. That is what you should simply say and once you have said that, it means that if the Government does not have faith and confidence in the inter-bank rate, who else do you want to have faith in the inter-bank rate?  In any event Hon. Minister, it will be cumbersome even for the Commissioner General to simply say that he or she has to consult the RBZ.  Let the inter-bank be the ruling rate.

         HON. NDUNA: What I need to hear from the Hon. Minister is to say, whatever it is, the language that he has used here, does it mean inter-bank rate and if so, is it just a question of semantics and if it is, would we then have challenges in passing it as it is?  Does he want it to be as flowery as it is?  Does he mean to say that this is inter-bank?  This is what I want to hear from him and if so, I have no challenges with this.  So I need him to clarify and then we move on.

                 HON. PROF. M. NCUBE:  Thank you Hon. Chair and I thank the

Hon. Members for their comments. The rate that the Reserve Bank will advise the Commissioner on is the inter-bank rate.  So there is no deviation of the advice from the Reserve Bank, from the customs exchange rate.  So there is no inconsistence there and I propose that we accept the clause as it is and move on.

HON. BITI: Hon. Chair, if the Minister says the rate that will be applied by the Commissioner of Customs for the purposes of Section 115 which we are talking about is the inter-bank rate, why should he not simply say so because we already know it in another law brought by him that it already defines what the inter-bank rate is.  Why do we need to go to Masvingo when we want to go Dotito?

HON. TSUNGA: Further to that Hon. Chair, the responsibility to designate the rate in terms of this provision rests with the Commissioner and not the Reserve Bank.  So it means that we have two centres of power in a sense, that on the one hand we have the Reserve Bank of Zimbabwe as monetary authorities that have the responsibility of fixing the exchange rate.  In this case, the Commissioner also has powers vested in him in terms of this provision to fix the exchange rate.  So there is some kind of distortions that may arise.  I am sure it is only proper that the Minister states categorically that the ruling rate will obtain.  Thank you.

HON. PROF. M. NCUBE:  The ruling rate will obtain and the ruling rate is the one that the Reserve Bank Governor will advise the Commissioner on when they seek that information and that rate will be the inter-bank rate.  So there is no inconsistency.  I suggest that we accept this clause as it is and we move on.

HON. BITI: Hon. Chairman, if this precedent is set that you have a customs exchange rate then the inter-bank exchange rate and next year, the Registrar General will come with a different exchange rate for passports.  The Minister of Energy and Power development will come with a different exchange rate for fuel; it does not work.  We only have one currency with one exchange rate and that exchange rate is known as the inter-bank exchange rate.  So why do you want to be eclectic – it is fejafeja economics.

HON. TOGAREPI: I understand where you are coming from but

the issue is, all these agencies that you are talking about, if they want to talk about the exchange rate, there is a common place where the true exchange rate will come from.  It is the Reserve Bank.  So whether you call it exchange rate or inter-bank rate, it is going to come from the Reserve Bank.  So, it is correct that the Commissioner at any place would ask the Reserve Bank for the true exchange rate.  In fact, this will be protecting the public because the source is the correct place where the exchange rate is going to come from.

                       Clause 24 put and agreed to.

                    HON. MUSHORIWA:  Hon. Chair, divide the House.

                               THE TEMPORARY CHAIRPERSON (HON. KHUMALO): 

Order, order, I want to follow the rules.  I can determine who are more than the others – [HON. MEMBERS:  Inaudible interjections] – I want to read that section.  Let me exercise my power by using this section.  ‘If however the Chair is of the opinion that a division is unnecessarily claimed or is an abuse of the rules of the House, he or she must decline to direct that a division must take place and must immediately declare the resolution of the Committee as the case may be’.

                           So I declare that Clause 24 stands part of the Bill – [HON.

MEMBERS:  Hear, hear.] –            On Clause 25:

                 HON. MUSHORIWA: I have problems with this clause.  If you

look at the rates of special excise duty on second hand motor vehicles,  the amounts that are stated there are those pegged in US dollars or RTGs.  I want the Minister to clarify this.  The other thing which I find it so difficult to understand is that we have been making an argument and that one has been raised from an environmental perspective and it has been raised several times.  Why should we as a country be so happy to import all vehicles into this country?

Hon. Minister, why should we reward a person who wants to import a vehicle which is more than 20 years and we punish a person that wants to import a vehicle which is less than five years?  I thought the Hon. Minister was going to simply say any vehicle which is more than ten years has to be charged high excise duty.  But this clause is saying any vehicle which is less than four years is charged a maximum of six thousand United States dollars, any vehicle which is around ten years is charged up to four thousand United States dollars, any vehicle which is about 15 years is charged around two thousand United States dollars and any vehicle which is over 20 years is only charged US$ 500.

So what it means is that the best way to buy cars is for people to go to Japan and get vehicles which are 20 to 25 years old and put them into the market and they end up flooding the market.  They only have to pay US$500; you are not putting into consideration the issue of the environmental impact.  The Hon. Minister is also not taking into consideration that we are wasting foreign currency by buying those vehicles.  I think this is not good.  Hon. Chair, I am worried that the Hon. Minister is not listening, this is crucial; we cannot allow foreign currency to continually be pumped out.  Why should you allow people to just buy wreckages/mazenge from outside and simply have them as if a person has bought a vehicle?  People should buy vehicles which are worthy.

HON. NDUNA: Hon. Chair, we have to make laws for the good of the people as enshrined in Section 117 and Section 119.  So, it is my thinking that the choice of vehicles that people choose to bring in should not be curtailed.  People should choose to bring in whatever it is that they choose to bring in.  However, it is my thinking that we propose the law here, of special economic zones.  People currently are going to Musina to buy their vehicles in bonded warehouses.  So we are actually giving a lot of income to South Africa.

The last time I checked when I was Chairperson of the Transport

Committee, a thousand vehicles were being imported each month, and at US$4 million that we are losing as a country to foreign lands.  So it is my thinking that if we allow those bonded warehouses to take refuge here in Zimbabwe in a special economic zone, the people get to be allowed to buy the choice of their vehicle.  The carbon tax gets to be in sync with the type of emissions from those vehicles in order to mitigate the climate change effect.

However, to then say we are forcing the ordinary Zimbabweans to buy brand new vehicles is out of this world.  I applaud the Minister for not trying to hold the ex-japanese vehicles from getting into the country.   I go further to say if he can establish a geographical location in order to harness and mop up all the forex that we are currently losing to foreign lands and he continues to levy the duties in the amount so stated by himself in Clause 25.

This is my thinking, but we need to harness all the forex that we are currently losing by just a stroke of a pen, establishing special economic zones so that we get much more than we are currently getting.  Further to the duty we get to also bank the amount that we are losing at a rate of US$4million monthly at a rate of thousand vehicles minimum US$4000 per Honda Fit or per BMW which ever applies.

                   HON. PROF. M. NCUBE:  Thank you Hon Chair.  On the issue

of these rates being too high compared to previous rates, what we did

was to convert the old US$ rates using a factor of 8 to the current rate.  That is way below the inter-bank rate of 15.  So these are not high at all and these are in Zimbabwe dollars.  Hon. Nduna mentioned the issue of looking at other ways to maximise the benefit from these imported cars.  I have listened and I think that there is merit in having a conversation with him privately to see how some of these ideas could be implemented and how additional revenues could be realised.  This is simply an issue of excise duty in terms of livelihoods in line with the size of the engine capacity and the number of years.  Thank you very much.

                 HON. MUSHORIWA:  From the submissions proffered no-one

even said the figures are too high.  The question is very simple.  The objection is that we cannot have Zimbabwe being a dumping ground for very old vehicles.  I would be happier to have a situation where – you said up to 4 years a person will pay a special excise duty of around $6000, but as you go, the more one imports an old vehicle he/she ends up paying $500.  So why are we allowing that to happen?  Why do we have to get a vehicle which is over 20 years cheaply than a modern vehicle?

There should be a deliberate way to discourage very old vehicles by setting car age limits where you say this $6000 should apply to vehicles over 16 to 20 years and then you leave the vehicles in the middle, the one under 5 to 10 years.  I would be happy with that.  Right now Hon. Minister if you move around within the neighbourhood you will see in parking spaces many dumped old Japanese vehicles because they are no longer serviceable and it becomes a problem.  So I am saying we should have a middle of the road approach.  People should actually be punished for bringing in very old vehicles like 20 year old vehicles.

                    HON. PROF. M. NCUBE:  I think duty is meant to be

progressive rather than regressive.  That is why you find that it drops as the age of the car goes up.  We are trying to take into account the remaining life of the car in the hands of the user or the owner.  That is all.  We are not trying to necessarily restrict the old vehicles over new vehicles.  The intention rather is to recognise the remaining life and making sure the excise duty is progressive enough.  Those with newer cars pay more because of longer shelf life and those with older cars pay less.  That is how we have designed it and we think it is fair to design it that way.  It is not in any way that we would have to do something else to make that restriction on older cars.  I thank you.

         HON. MUSHORIWA:  Hon. Minister, you are not only the Hon. Minister of Finance but also for Economic Development.  I need you to clarify the issue of environmental costs. Are you factoring that in?

                 HON. PROF. M. NCUBE:  Hon.  Chair, I had to consult because

there is some history that is necessary to understand this schedule.  There used to be a rule that if you are selling cars in the second hand market you pay 5% of the value of the car.  That is all you did. So it was never linked to the size of the engine or the age of the car, but now actually these rates – I was really consulting hard and deep, these rates pertain to the sale of cars in the second hand market domestically.  The cars are not necessarily imported cars.  They are not only imported cars, they could be from Willowvale – the domestic sale of cars in the domestic market and we are differentiating according to age and engine size.  That is all that is going on here.

So, older cars then pay less than newer cars, but also bigger cars in terms of engine size pay more than the smaller cars.  That is what is going on here.  I think there is really a mix up in the language.  Even I got a bit strung up.  When I saw customs I thought, what?  It is not necessarily imported cars; this is just the second hand market for cars.

HON. CHIKWINYA: Can you change the language to protect us.

HON. PROF. M. NCUBE:  No, I think that it says rates of special excise duty on second hand motor vehicles.  I think it is clear enough.  It just so happens to be governed by the Customs and Excise Act, hence the thinking that it might mean that these are imported, but they are not necessarily imported, it is domestic cars.  We are differentiating using engine size or indeed age, that is all.  Thank you. Amendment to Clause 25 put and agreed to  Clause 25, as amended put and agreed to.

On Clause 26:

HON. MUSHORIWA:  Chair, I need the Hon. Minister to explain to us why is it that there is no royalty paid on diamonds where it says

‘diamonds but no royalty is payable in respect of diamonds, so get a discount equivalent to the value of royalty otherwise payable to any local diamond manufacturer.’

My major issue is that we do not have a market of diamonds in Zimbabwe and the question is, how do you define and come up with these figures to know whether the value is otherwise equivalent or lower than the prevailing local diamond manufacturer?  I do not know how do you come up with this?

HON. TSUNGA:  Thank you very much Hon. Chair, just clarity.  It could be minor but it is important.  The Clause talks of diamond manufacturers and I was just wondering and thinking to myself whether there is anybody or any company that manufactures diamonds, unless if it is synthetic diamonds, I am not too sure?  Minister, maybe you could clarify.  Thank you.

HON. PROF. M. NCUBE:  On the issue of diamond

manufacturer.  This is possible in future, absolutely, but that is not really the point of the Clause.  The Clause is about how the royalty should be treated.  It says, ‘diamonds but no royalty is payable in respect of diamonds sold at a discount equivalent to the value of the royalty otherwise payable to any local diamond manufacturer.’

So really you do not over penalise here where the royalty is more than the discount.  I think that is fair, otherwise then you are punishing the seller of diamonds.  That is all that is going on here.  If you look at the second part of that Clause it really pertains to royalties in terms of other minerals, in which case here it is black granite or other cut or uncut dimensional stone.  This again was requested by the sector that they would like to be classified as a mineral, once they are classified as a mineral, which we agreed to, then naturally the royalties apply accordingly as to other minerals.  That is all there is to it.  There is no confusion here really, Hon. Chair.

Amendment to Clause 26 put and agreed to.

Clause 26 as amended put and agreed to.

Clauses 27 and 28 put and agreed to.

On Clause 29:

HON. MUSHORIWA:  We need the Hon. Minister to explain to us the rationale in terms of drastically changing the period from six months to about three months because in my view 180 days to 90 days is drastic.  What is the mischief that the Minister wants to cure in this regard?

HON. PROF. M. NCUBE:  Hon. Chair, this Clause amends the regulation making provision of the Revenue Authority Act, especially the provision empowering the Minister to provide for civil penalties for the infringement of revenue laws.

The maximum period for compliance with a civil penalty is reduced from 181 days to 91 days before criminal penalties also apply.

So it has got to do with the compliance or else penalties begin to kick in.

I thank you.

Amendments to Clause 29 put and agreed to.

Clause 29 as amended put and agreed to.

On Clause 30:

HON. TSUNGA:  Thank you very much Hon. Chair.   On Clause 30, as stated in the preamble paragraphs the Clause amends the RBZ Act by reinstating the Monetary Policy Committee which committee was abolished after the adoption of the multi-currency system in 2009. The committee composition at the top comprises senior staff of the RBZ and of course other members for their expertise in finance and monetary policy.  If you look at the terms of reference or the functions of the Committee, they bring back the memories of the quasi-fiscal operations of the RBZ pre 2009, characterised by such interventions as bacossi, and as foliwas resulting in the economic instability in the country...

                               THE TEMPORARY CHAIRPERSON (HON. KHUMALO):

Can you proceed Hon. Member. What is your point?

                       HON. TSUNGA: The point is I just want to find out from the

Hon. Minister what safeguards are going to be put in place to ensure that  decisions made by the committee prior 2009 will not recur because as I see it in terms of the clauses – the monetary policy committee is an autonomous authority entire unto itself and only consults the board or simply submits its reports or findings to the RBZ board only for information and not for direction or supervision.

         In other words there is no oversight in terms of the operations of the Monetary Policy Committee. So, what safeguards is this legislation going to put in place to ensure that the previous negative experiences of pre 2009 do not recur. Thank you.

                 HON. MUSHORIWA: Mr. Chairman, this is one Clause that

should not have been part of this Bill. Firstly, it is wrong for the Hon. Minister to tell us that this monetary policy committee is going to be independent of the board. Apparently, if you read the Reserve Bank Act, it tells you that the Reserve Bank Board consists of the Governor as the

Chairperson of the Board and the Deputy Governors. The correct procedure that should have happened was that the Minister was supposed to bring the RBZ Amendment Bill because we believe that RBZ Act needs to be amended so that it fits into the requirement of this country.

                 Secondly, this one says that there is the Governor and the Deputy

Governors who will be the Deputy Chairpersons just as the RBZ Board. That is what it also says and not less than five or more than seven persons appointed by the President after consultation with the Minister. There is no way in this provision which says that the other members are going to come outside the RBZ. It is left to the discretion of the Minister. The Minister pointed out during the Second Reading to simply say these one will be independent, but even assuming we were going to concede that the Minister is going to take people who are not necessarily from the RBZ, the question is very simple. Here is a committee that is chaired by the Governor and deputised by the Deputy Governor.  After doing their business they will come back to the RBZ board and reports

to the Governor as the chair and the Deputy Governor as deputy of the committee.

         The whole thing on corporate governance falls off and this is my view that there was no rationale to even try to smuggle this into the Finance Bill. It is better for the Hon. Minister to really consider because the market out there is calling for an amendment to the RBZ Act. Let us bring a proper RBZ Amendment Act not this piece-meal. Thank you.

                  HON. PROF. M. NCUBE: Thank you Hon. Chair - this section

firmly belongs in the Finance Bill. When it was initially repealed, it was repealed through the Finance Bill. Let me also explain about the monetary policy committee and how they function. What we have inserted is global best practice. Monetary policy committee is meant to be custodian of monetary policy conduct especially around the setting of interest rates which is very clear here. The composition is that while it is independent of the board and it has to be independent of the board, there is some cross fertilization via the presence of the Governor and the two deputies who are members of the MPC.

         The Governor chairs but what really gives it independence is the five additional members who are appointed from outside the Reserve Bank. They are always outside the institution. Otherwise, we would have said appoint three plus others – it is very prescriptive. It is outside the Reserve Bank and the decisions are not through the dictates of the Chair but it is through voting process. Those are the rules. If we say we are increasing interest rates, they have to vote. It is by voting simple like that. If we have to do something else we vote.

         I have no record that bacossi was introduced by a Monetary Policy Committee. So, the member should not fear too much regarding independence. The MPC, the current one is made of very strong headed people. All of them are strong headed and so, you can be sure that they are having very robust debate. I am pleased that they are having robust debate and I am pleased with the results so far. For instance, the last decision about lowering the interest rates - because we realise that if we need to focus on the productive sector, we need to do something about the cost of capital.

         The debates are raging and I am very pleased with it. So, there is no issue about them being coerced or co-opted or whatever by the Central Bank officials. The decisions are through a voting process and again this is standard. It is global best practice. We cannot think of a better way to craft it. Thank you.

                 HON. MUSHORIWA: Hon. Chair, I really wish I would actually

be saying that I had the same confidence that the Hon. Minister is raising. From where I am standing I am not seeing anything that is happening. Specifically, I think this Clause that five or more than seven other persons appointed by the President, we should insert where it says, outside the RBZ and outside the Ministry of Finance. One of the problems that we face in this regard is that there are certain individuals who may not necessarily be under RBZ but may be spread to organisations or to areas which in a way are answerable to the RBZ.

         The Hon. Minister talks of the global best practice but you will also appreciate Hon. Minister that where this one works well, the board of the Central Bank is not chaired by the Governor and that is where it works well. If the Minister is true and by the way Hon. Minister I am not aware and may be you could educate us on the current composition of the monetary policy where they are coming from. I will bet you that we want a clause here to simply say that the 5 or more than 7, what percentage of the 5 or more than 7 who are not coming out from the RBZ and the Ministry of Finance, because to me it is more or less one and the same.


DEVELOPMENT (HON. PROF. M. NCUBE): Hon. Mushoriwa must

actually sleep well. Out of the independent 5, none of them work for RBZ, neither are they under any institution that is supervised by RBZ which is typically a bank. In fact we will not allow anyone who actually sits on a bank as part of management or whatever to be part of the Monetary Policy Committee, that will be problematic.  It means that they will be privy to information in the market, they will front run and do all manner of things.  Again it is global best practice that we do not do that.  We know the rules well.  In the Ministry of Finance we do not have a Ministry of Finance official sitting in the MPC Committee at the moment.  I thank you.

                       Clause 30 put and agreed to.

                       On Clause 31:

                      HON. MUSHORIWA: Thank you Hon. Chair.  Hon. Minister,

this Clause is tricky. You recall that using Statutory Instrument, you have gone on to exempt other stakeholders from not using the Zimbabwe dollars as an inclusive transaction. The challenge that we face is if you look into the RBZ amendment which you have actually said you are now withdrawing. You notice that there are certain areas that have been excluded, areas like petrol or diesel dispensed to guests of State, diplomatic missions, gazetted regional international organisations, diplomats, members and staff of diplomatic organisations and international airline services.

         Under this clause, that is not mentioned and we want this one to be covered here.  There is something that is worse, currently as we are speaking the Simbisa group that owns Chicken Inn and company, they are allowed to charge forex, apparently they say that they are in the tourism sector so they can actually be allowed to charge in forex.  Now that cannot be exclusive, we want a policy that governs everybody.

         Why should we have Chicken Inn charging forex, what about Chicken Slice and Mushoriwa take aways, they are all in the same category.  The way the Minister is actually putting it is actually creating a huge challenge.  To that extent, I put it to the Minister to simply say that this clause does not tally with what he has already done using other Statutory Instrument.  This clause is supposed to take over all those Statutory Instruments.  I want him to clarify to us that those areas that he had actually said they will not be covered, what is going to happen to them.

                     HON. TSUNGA: Thank you Hon. Chair.  To simplify what Hon.

Mushoriwa has said under Clause 31, I take it that the clause contradicts sever other clauses within the Bill and a good many of the clauses in the

Bill state that certain payments will have to be made in foreign currency.

 There has also been debate about the presumption that if you do prove that you have paid in Zimbabwean dollars, it will be deemed that you received payment in US dollars and therefore will be taxed accordingly in foreign currency.  Where this Clauses says the enforcement of the exclusive use of the Zimbabwean dollars for all domestic transactions. So this clause contradicts the whole essence of having the use of US dollars instances. I think there is need for refinement so that it is clear there is probably a proviso to qualify that clause.  Otherwise one can stand in a court of law and say I may not pay the tax as demanded in US dollars because that clause states categorically that all transactions have to be in Zimbabwean dollars. So take care of that contradiction Hon. Minister, I thank you.

                         *HON. CHINOTIMBA: Thank you Chair. In other countries like

in South Africa and Namibia, whether it is a tourism sector or not they change their money at their banks and foreigners will go and pay in that country’s currency.  I know we are short of foreign currency in this country, the Minister of Finance does not have access to all the foreign currency received from Chicken Inn and hotels et cetera.  We have thieves in this country.  I suggest we use our local currency because we noticed that the Simbisa Group is given that privilege but they are not truthful in their transactions on the question that they receive both RTGs and foreign currency.  We need just to state that the proper thing that we must do is to use the same currency which is RTGS and not give license some to use foreign currency.  In other countries they only use one currency.  The Simbisa group should be relieved of that privilege.


over the spirit of the debate around the enthusiasm over the use of the Zimbabwe dollars and I really welcome that.  Through the Chair, the call of Clause 31 is about the penalty that is what it is all about.  It is focusing on the penalty and all we are trying to do is to give the Reserve Bank teeth so they it can impose penalty, enforce penalty on those who are violating the law, for those areas we expect them to use Zimbabwean dollars.  Yes, it is true there are areas where we have made exemptions, the US dollar is being accepted and you pay your taxes in that currency of trade, that is also true.  It is also true that we are going through a transition, you can be sure that all those areas where you see US dollars being used, with or without permission will be closed over time and they will be a complete switch to Zimbabwe dollars.

         Reserve Bank of Zimbabwe did not have teeth in the form of these civil penalties and enforcing them and that is why we spent a lot of time going through all those penalties and that is what Clause 31 is really about.  I thank you.

         *HON. CHINOTIMBA:  Mr. Chairman, I agree that we should give more power to the Reserve Bank of Zimbabwe.  I am giving you a background so that you understand where I am going to.

At the moment, we are facing challenges especially cash challenges regarding the coins that are not being accepted for some transactions.  As far as I am concerned, we seem to be living in two worlds where we have the Ministry of Finance and Economic

Development through the Reserve Bank of Zimbabwe issuing notes and coins.  On the other hand, we have monetary street vendors who are also creating their own world of currencies and they really enforce their decisions like what you are saying where they are refusing to accept some coins and notes.  The people who are doing this are from the Reserve Bank of Zimbabwe who are supposed to be policing the collection of monies from these street cash vendors.  We are in financial challenges yet we have a lot of money in this country. We have a few people who are fueling these challenges.  We want the Ministry to formulate stiffer rules and penalties in the control of finances in the country because people are suffering and being harassed.  We are told that money has been put into the system but there is nothing.

I am still talking about the Simbisa Group of Chicken Inn because we are not getting any money from the transactions that come through that source.  Unless if the Hon. Minister can state how much foreign currency he is receiving from the Simbisa Group who are the only ones allowed who are allowed to transact in foreign currency since they are a food outlet.  At the moment, it is the same whether or not we have foreign currency or local currency – we still have challenges.

Currently, we have challenges in acquiring fuel.  Why should we still be having that challenge when we have some retail outlets that are transacting in foreign currency?  Something sinister is happening here and I know some people are into business.  They collect a lot of money and at the end of the day, they have a lot of money that they would have collected.  These people also indulge in money laundering and this is why I am saying let us create a law that will impose strict and stiffer penalties to those people who breach these financial laws.’

+HON. MAHLANGU:  I totally agree with Chinotimba …

THE TEMPORARY CHAIRPERSON: Order, order it is Hon.


+HON. MAHLANGU:  Hon. Chinotimba and Hon. Minister, I dispute the fact that the Zimbabwe Dollar is in existence because I am yet to see it ever since it came into existence.  I think that the USD$ is far much better than the Zimbabwe Dollar.  Where is the Zimbabwean currency that you are saying is the currency that we have?

Like what Hon. Chinotimba said that you can only access if from the black market but cannot get it from the banks - yes, I heard that a new Zimbabwe Dollar was introduced but I am yet to see it.  Why can we not allow everyone to use the United States Dollar, maybe it is a way to curb the black market?  Why do you keep saying that we have a Zimbabwe dollar whilst we are not even seeing it in the formal sector?  I thank you.

HON. CHIKWINYA:  To share my point on Clause 31, Hon. Minister, I think that you are missing the point somehow.  The point is that you have not managed to convince us as parliamentarians the benefits of partial liberalisation in terms of licensing or exemption towards the use of purely Zimbabwe dollars or – [HON. TOGAREPI:  You should not say, convincing us parliamentarians. You should rather say ‘convincing me and not include all of us.’] – You have not convinced me as an Hon. Member.

I am saying so Hon. Chair, because what is the criterion that informs the Hon. Minister for him to be able to licence Chicken Inn and not Chikwinya Restaurant? That is one and what I am seeing is that the partial licencing of your Chicken Inns is actually creating that demand for the United States Dollar which is now being abused.  The argument favoured by Hon. Chinotimba stands true, that in every other country that has got its sovereign currency tourists go to the Bureau de Change which you have established Hon. Minister and they change their foreign currency and buy in the local currency.  It then creates uniformity in terms of exchange rates and exchange controls.

The moment we have other pockets of the community or the business community being able to trade in United States Dollars, we are creating that leverage and gap for the abuse of foreign currency.  Right now Hon. Chair, I want to challenge the Hon. Minister – the market has completely dollarised, the market has dollarised.  Today I bought fuel at an Engen garage in Kadoma – the garage owner does not want Ecocash or swipe and has rated the United States dollars.  I think law enforcement agents – this owner was selling fuel in United States dollars last week.  So I went there with my United States dollars intending to buy fuel and I think that the law enforcement agents paid him a visit and told him that it was unlawful.

What does he do?  He has rated the United States dollars to the parallel market exchange rate, so it is 1:23 and selling a litre of diesel at twenty-three cents (USD$0.23).  So what this guy is simply doing is taking the twenty-three Bond and goes into the black market to buy United States dollars.  How does he buy these United States dollars?  He has got Chicken Inn as a ready market because Chicken Inn now has other domestic debts to settle in terms of water, power and everything.

They will then take that United States dollars and sell to the fuel guy.

So you are now creating an opportunity for the exchange of between the Bond note and the United States dollars.  My proposal is to support Hon. Members who have said that anyone who has their United States dollars and we get these from various sources – the diaspora and some are in the mining industry, let them go to the Bureau de Change or the bank and change at interbank rates and then go and buy.  This will kill the parallel market rates.

Currently, the parallel market rate is being created by the high demand of foreign currency to businesses that have been allowed to sell in foreign currency.  So I beg with you Hon. Minister that I am sure that this is the opportune time for you to consider this so that at least you protect the very few money that is available.  If we are going to make that public pronouncement tomorrow that no one is allowed to sell in foreign currency, you are going to see the merging of the parallel market rate and the official exchange rate to a stabilised exchange rate which then determines the market going forward.  This is my submission Hon.


HON. MAYIHLOME:  Maybe just to add a point here Mr. Chairman.  The reality on the ground is that, imagine everyday you say that every Zimbabwean is allowed to withdraw ZWD$300.00 from the bank, where does the ZWD$300.00 go to at the end of the day?

Hon. Chairman, I think that we need to be very serious on this issue.  Where does the $300 end up?  Very little of it ends up in people’s pockets.  It ends up in the shops and those shops convert it to US$ immediately.  That is what is happening with our money.  Nobody takes any cash to the bank because banks are not paying anything – they have got very negative interest rates.  That is the reality.  Banks are profiteering from bank charges.  That is where they are making their money from.  Where you have an economy where banks are profiteering from bank charges nobody will take the money to the bank.  We need to be sober enough and be realistic on this issue and say we have to deal with the black market rate because it is affecting us as pensioners.  We are pained everyday that we get our money and that money is transferred because people are using the US$ as a store of value.  They are no longer using it for transactions but if you get your $300, convert it to US$ to keep the money – that is what the perceptions are out there.

HON. MUSHORIWA:  This one is very crucial.  I think the Hon.

Minister is not paying cognisant to what the Hon. Members are saying.

There is no country where you have got one law which applies favourably to Paul and then applies unfavourably to John.  You cannot have such a law in a country.

We are very aware that this one relates to the question of punishing but how do you punish Peter when I am seeing that John is being allowed to go free.  It does not make sense.  The Minister has to make a decision.  Are we going for exclusive Zimbabwean dollar or are we going back to the dollarisation or we are allowing both systems to run concurrently?  There are a lot of policy inconsistencies.

Hon. Minister, you will recall that Chicken Inn and other companies that are selling in foreign currency did not start to sell in foreign currency.  When it was gazetted that we were now going for the Zimbabwean dollar, everybody went to Zimbabwean dollar then one by one exemption were now ditched by the Hon. Minister and now having given all those exemptions, I then have to ask the reason why some of us tend to disagree to say is it real parallel market.  Some of us prefer to call it people’s market because the majority of the people in Dzivarasekwa which I represent get their forex at what they call the parallel market.  This is the reason why some of us will then say it is the people’s market. There are a very few people that are going to the interbank market.

This law tends to punish the majority of the people.  I will give you a good example; we were being told by the Hon. Member that represents Victoria Falls that most of the companies that operate there charge in foreign currency.  They also pay their workers in forex.  It is not only Victoria Falls – quite a number of areas that are actually even in areas that are frequented by tourists are doing that.

This law is not relevant at this particular moment.  The truth of the moment is very simple – the Hon. Minister must do an honourable thing.  The honourable thing is to simply say – you cannot continue to be saying we are moving this direction when the whole country is moving the other direction.  Otherwise all that we are doing here becomes irrelevant to people we purport to be representing or purport to be leading.

HON. TOGAREPI:  I hear what Hon. Members are saying on this issue and I really sympathise.  When we talk about the challenges that we face in the usage of different currencies but I think we are widening the discussion, it is no longer on this clause.  The issue of using foreign currency in any country – the hospitality industry and many other industries; what is needed is control.  What we should be mourning as Members of Parliament is – does the Minister have enough controls to protect the use of that money when it gets to Chicken Inn?  The issue if I understood  very well what the Minister is saying, is when you then charge offenders on this  use of foreign currency and how they are going to be penalised.  What people are now talking about is that – agreed; people are suffering because of the use of foreign currency but is it the issue in relation to the clause?  If it is not, let us debate it on another day.

HON. PROF. M. NCUBE:  Togarepi has put it very well.  The debate has been widened - [HON. HAMAUSWA:  It is Hon. Togarepi and not Togarepi.] – Hon. Togarepi, our Chief Whip has argued very well. I was also listening to the debate and I could feel it widening.

People were raising very valid concerns but they are not part of this clause.  This clause is narrowly about civil penalties.  That is all we are doing.

I understood what Hon. Chinotimba was talking about which is boots on the ground.  Again, that is an additional enforcement mechanism which the Reserve Bank after having given all these powers must get boots on the ground.  I agree with that.  There are many other ways again for enforcement.  You could come up with a bouquet of enforcement mechanisms but all we are requesting is very clean and narrow.  It is about civil penalties.

Clause 31 put and agreed to.

On Clause 32:

HON. MUSHORIWA:  I am standing to debate.


There is no debate....

HON. MUSHORIWA:  There is a challenge because Clause 32

does not exist.


debate on since the Clause is not there?

HON. MUSHORIWA:  I want to point out something that you should actually see – [HON. MEMBERS: Inaudible interjections.] –



HON. MUSHORIWA: No, no.  The Hon. Minister is there – I want him to listen to what I am saying so that he will be in a position to debate – [AN HON. MEMBER: You are just flipping the papers and you have nothing to say] –

THE TEMPORARY CHAIRPERSON: Go to page 24 please.

HON. TOGAREPI:  On a point of order.  I think we are dealing with this Bill on a serious note.  So, Hon. Members should have gone through the Bill and get areas they would want to debate.  However, if somebody says there is no 32 and yet he wants to debate 32, I think he is wasting our time.

HON. MUSHORIWA: Hon. Chair, there is no valid reason for this august House to backdate the validation of Statutory Instrument 295 of 2019 to 20 September.  I think it is wrong and the Hon. Minister, just like we are saying; one of the major challenges we are facing as a country is we cannot have a country that is run by statutory instruments.  Whenever we bring a Finance Bill, all the provisions that were contained in a Statutory Instrument should actually be put into the Bill and then they start with immediate effect.  We are seeing a push by the Hon. Minister that he wants to leave room to maneuver outside the purview of this House, working through statutory instrument.  Business is complaining about such behaviour.

HON. PROF. M. NCUBE: Thank you.  Hon. Chair, I think Hon.

Mushoriwa has been very participative this evening, very busy indeed.

Clause 32, regarding SI 295; what happened is, in the Finance Bill No.

2, 2019, the top rate in terms of income tax was reduced from 45 to

40%.  However, when the Bill was typed and all that, there was actually an error, the rate was still maintained at 45%, it should have been dropped to 40%.  So we had now issued this SI295 to correct that.  However, because Statutory Instrument cannot amend and Act; what we are doing now is actually effectively reducing that top rate from 45 to 40% but we are doing it via confirming the Statutory Instrument.  That is all we are doing; actually this is to clean up an error in the previous Finance Bill.  There is nothing amiss about running the country through statutory instruments, which is a little bit overstated.  That is all we are trying to do Chair, I thank you.

Clause 33 put and agreed to.

On Schedule Section 31:

HON. MUSHORIWA: That was my point Chair, when

everybody thought I was sleeping.  Chair, part of the reason why some of us strongly feel that the Hon. Minister is abusing this House by bringing this; this is the reason why we wanted a proper RBZ

Amendment Act.  If you read the schedule, in my view, there was need for the Parliamentary Committee so that it is subjected to the Parliamentary Committee.  We are creating the RBZ, giving it some judicial powers.  In my view, it is difficult as it stands right now for people to properly ventilate because we wanted stakeholders to also contribute and tell us what their views will be pertaining to all these civil penalties.

Whenever you bring such a Bill with all these penalties Mr. Chair, I actually believe that these amendments are the ones which require consultations with various stakeholders.  I think what we are being driven into by the Hon. Minister is to try to cut the work of Parliament.  There is no reason and no justification for this issue to come under the Finance Bill.  It is my view that Hon. Minister, if possible, this one was supposed to be removed from the Finance Bill.  I believe that the Parliamentary Committee on Finance and Budget should be given time to go through it.

HON. PROF. M. NCUBE: I think Hon. Mushoriwa, I appreciate his energy this afternoon and evening but you are mixing up things.  The Schedule here is an Income Tax Schedule, it is not an RBZ issue.

HON. CHIKWINYA: Hon. Chair, as we passed the 2019 Budget in November of 2018 – I am saying this because I can see that the Minister is about wind up.

THE TEMPORARY CHAIRPERSON: Order please, has it to do with…

HON. CHIKWINYA: Yes, it has to do with the Finance Bill.


Schedule, does it have anything to do with the schedule.

HON. CHIKWINYA: No, it has to do with the Bill but…

THE CHAIRPERSON: Order please, we are not doing that.

HON. MUSHORIWA: I wanted to say to the Minister, have you gone through the Schedule?  If the Hon. Minister has gone through the Schedule, he would understand my rationale.  Starting from page 18, power of the Reserve Bank to issue civil…


Schedule Section 31 put and agreed to.

On Clause 21:


out what this was about.  It actually turns out to be a benefit to tax payers Hon. Chair.  What happened was that, we are here trying to deal with cases where if you use a piece of machinery to produce a product and this product is zero-rated and we change the tax on it, that machinery is deemed to be taxable and so on.  We want to make sure that the supplier/producer is not unfairly treated and ZIMRA should stay far away from taxing the owner of that piece of machinery.  That is all there is to it.  We want to make sure ZIMRA does not go back and demand taxes from those who own machinery, whose products are now zero rated. That is all we are trying to do. This is actually a benefit to tax payers rather than a cost. I thank you.

         HON. MUSHORIWA:  Hon. Chair, I think the clarification is not clear.  When you say the owner of the machinery, whom do you mean?  If the machinery has been imported, are we saying that ZIMRA is going to look positively to the imported machinery or you are talking of the owners of machinery that is locally manufactured that is producing zero rated products?

         HON. PROF. M. NCUBE:  This is about the taxation of machinery that is deemed to have been disposed, because its product is now zero rated.  We are saying if the product has now been zero rated, in other words, we are the ones who have changed the tax rates and zero rated a product.  The machinery used to produce it and is deemed to have been sold, ZIMRA should not go after owners of the machinery and demand Capital Gains Tax, sales tax or whatever.  They should leave them alone.  That is all we are saying, so it is actually benefitting the economy rather than punishing it.  It is very clear.  Thank you.

                              HON. CHIKWINYA:  Thank you.  My point of clarification Hon.

Chair is that when we were discussing the 2019 Budget, in November

2018, we inserted a clause that had to deal with the gratuity of an Hon. Member of Parliament who would have served one term and there was a formula which the Minister had stated.  The Hon. Minister gave feedback to the Standing Rules and Orders Committee that the formula did not produce a figure that would sustain a meaningful gratuity and secondly that it was not backed by law.

         I am raising this point of clarity at this stage because I am not seeing that particular law being made as we debate the Finance Bill.  How does the Hon. Minister intend to deal with that particular section of the 2019 Budget, which has not been carried over into the 2020 Budget?

    THE TEMPORARY CHAIRPERSON:  Hon. Member, this is

Committee Stage.  That issue should have come at Second Reading. You missed it, otherwise it cannot be captured in this Bill.

                   HON. MUTSEYAMI:  Thank you.  Mr. Chair, with all respect,

this has nothing to do with political machinations.  This is purely to do with the welfare of Members of Parliament.  This thing was discussed at a higher level in the Committee of… - [AN HON. MEMBER:  Inaudible interjections.] – This benefits even you Hon. Chinotimba.  Give me a chance.  Mr. Chair, this thing is important. You will realise it when you are home.  We agreed as a Committee on Standing Rules that we have first time Members of Parliament and their allocation of gratuity does not put value to the five years that they were in Parliament.  There was supposed to be a legal instrument which addresses buds that so that Parliamentarians who happen to fail the next primary election will be able to get their gratuity which is useful and reasonable.  There is need for this amendment to include that clause which is supposed to cater for the first time gratuity of a Member of Parliament who finishes one term.  It is time that we have to include that.  This is the opportunity that we must include that and with the intelligence of our Leader of the House, that can be done now and get approval from Members of Parliament.

                 THE TEMPORARY CHAIRPERSON:  Hon. Member, I heard


                 HON. MUTSEYAMI:  Mr. Chair, you can argue from an

academic point of view.  This is for the future of Parliament. It is to do with this amendment and that room is there.

                         HON. PROF. M. NCUBE:  Thank you Hon. Chair.  What

Members of Parliament are raising pertains to benefits of Members; it has nothing to do with tax obligations.  This clause is about tax obligations arising from the use of machinery for production and you change that use.  That is what this clause is about.  We are saying that we do not wish for ZIMRA to go back to deal – [AN. HON. MEMBER:

This is a new clause.] –

                       THE MINISTER OF JUSTICE, LEGAL AND


with all due respect, if they had brought that as an amendment because this Bill was already – [AN HON. MEMBER:  Inaudible interjections.]

– No, no, no.  We cannot do it now, we have already finished everything.  We can do it later and see how it can be accommodated but for now Hon. Chair can we proceed.  We are not disagreeing that it is a matter than needs to be looked into but surely if this matter has been brought earlier and put on the Order Paper we could have dealt with it as it arose.  Now, I suggest that we proceed and we will deal with it.

The Minister is amenable to dealing with it and we are all in agreement.

I thank you.

                       House resumed.

                      The Bill reported without amendments.

Third reading: With leave, forthwith.


FINANCE (NO.3) BILL [H. B. 21, 2019]


read the third time.

Motion put and agreed to.

Bill read the third time.


APPROPRIATION (2020) BILL [H. B. 22, 2019]


read a second time.

Motion put and agreed to.

Bill read a second time.

Third Reading: With leave, forthwith.


APPROPRIATION (2020) BILL [H. B. 22, 2019]


read the third time.

Motion put and agreed to.

Bill read the third time.


adjourned at Twenty-Nine Minutes past Seven o’clock p.m.



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