Home News Finance Minister Mthuli Ncube Unveils ZWL$ 58 Trillion Budget

Finance Minister Mthuli Ncube Unveils ZWL$ 58 Trillion Budget

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The Minister of Finance and Investment Promotion, Professor Mthuli Ncube has presented the 2024 national budget, outlining key strategies to address economic challenges and drive sustainable growth in Zimbabwe.

Presenting the ZWL $58.2 trillion budget at the New Parliament Building, Professor Ncube said Zimbabwe’s economic growth is projected to reach 5.5% by the end of 2023, which is higher than the previously projected figure.

“I am pleased to announce that Zimbabwe’s economic growth is projected to reach 5.5% by the end of 2023, surpassing our previous forecasts,” stated Minister Ncube. He further acknowledged that the impact of drought is expected to result in a decline in the growth rate to 3.5% in 2024.

The budget statement announced that civil servants’ USD 300 covid-19 allowance would be pensionable beginning January next year while also increasing the tax-free portion of bonuses from ZWL 500 000 to ZWL $7 500 00 effective 1 November 2023.

In terms of exports, merchandise exports in Zimbabwe stood at US$5.2 billion during the first nine months of the year. It is projected that by the end of 2023, exports will increase by 4.3% to US$7.3 billion, driven by higher exports of tobacco, lithium, and diamonds.

Professor Ncube said that the government will continue to support the mining sector to ensure sustainable growth of the sector projected at 7.6% in 2024, driven by ongoing investment in PGMs, gold, coal and lithium, among others.

He proposed a 1 % levy on gross proceeds of lithium, black granite and other cut or uncut dimensional stone and quarry stone to help develop basic services in local communities such as water , health care and sanitation among others.

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He added that under new regulations, all documents and agreements pertaining to the transfer, disposal, or lease of mineral rights must be lodged with the State for thorough review and approval before any conclusion can be made.

Professor Ncube further emphasized that; “The transfer of mining rights will only be granted upon payment of capital gains tax, stamp duty, and any other applicable taxes. Non-compliance with these conditions will render the disposal or lease of mining rights null and void.”

He set benchmarks for lithium producers to beneficiate up to lithium carbonate or get slapped with an export tax.

“The proposed regulations also emphasize the importance of beneficiation in maximizing the economic benefits derived from Zimbabwe’s abundant mineral resources. With significant deposits of Platinum Group of Metals, gold, lithium, and diamonds, the government believes that economic transformation and development can be anchored on beneficiation. In this context, any value addition process for lithium that does not result in the production of lithium carbonate would not be considered as beneficiation and would be subject to an export tax,” he said.

The Finance Minister said that to ensure effective monitoring of mining rights for tax purposes, the government suggests the establishment of a register dedicated to mining rights. This register would maintain records of applications, grants, variations, dealings, assignments, transfers, suspensions, and cancellations of mining rights. It would be accessible to the Zimbabwe Revenue Authority, enabling the government to track the movement of mining rights and ensure compliance with tax obligations.

In budget allocations, the Ministry of Health and Child Care was allocated ZWL$ 6.3 trillion, Primary and Secondary Education ZWL $ 8 trillion while the Ministry of Lands, Agriculture Water, Fisheries and Rural Development was allocated ZWL$ 4.3 trillion.

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