Finance Minister Mthuli Ncube has said Zimbabwe will need to rely on taxes to fill the gap left by cuts in U.S. foreign aid.
After his inauguration, U.S. President Donald Trump issued a series of executive orders, including withdrawing the U.S. from the World Health Organization and freezing all foreign aid for 90 days to assess whether programs align with his “America First” agenda.
As reported by <a href="https://newzwire.live/mthuli-with-foreign-aid-at-risk-zimbabwe-will-rely-on-taxes-to-fund-healthcare/">newZWire</a>, by the end of 2023, the U.S. had over $300 million in active programs in Zimbabwe, according to the USAID foreign aid portal. These funds are channeled through NGOs, not the national budget.
Zimbabwe receives over $200 million annually from the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR), which supports health workers’ wages and HIV prevention programs.
Speaking from the World Economic Forum in Davos recently, Ncube said Zimbabwe will now rely on taxes to fund its healthcare needs. He said:
<blockquote>
We are talking about $200 million or so (on PEPFAR) that is at stake. Our response really should be domestic resource mobilisation, which is what we have been doing.
</blockquote>
When Ncube referred to “domestic resource mobilisation,” he was talking about a range of new taxes he has introduced. These include a tax on sugar content in drinks and a 1% tax on fast food.
In addition to these, Zimbabweans already pay an AIDS levy and “sin taxes” on beer, both of which are aimed at supporting healthcare. Said Ncube:
<blockquote>
All these taxes form the base that we can use to build resource mobilisation to support our health needs. It has to be really through this kind of thinking that we raise resources to support health domestically as foreign funding is under threat.
</blockquote>
WHO estimates that more than half of Zimbabwe’s health spending is funded by external donors. This year, the country expects to receive $461 million for health programs, up from $353 million in 2024.
However, the government has struggled to adequately fund public healthcare. In 2025, Zimbabwe plans to allocate just 2.1% of its GDP to health, down from 4% in 2024.
What little funding is allocated to health is often disbursed late. According to Treasury’s 2024 mid-year report, only 27% of the health ministry’s budget had been used by June.

Pindula News

Zimbabwe needs money to fund healthcare because U.S. aid is getting cut. The Finance Minister, Mthuli Ncube, says they will use taxes instead. They used to get over $200 million a year from the U.S. for AIDS relief. Now they will use new taxes like on sugar and fast food to raise money. The government has struggled to fund healthcare in the past. They hope to raise more money through taxes to support healthcare programs.

Mthuli Says Zimbabwe To Fund Healthcare Through Taxes Following U.S. Aid Cuts

Finance, Economic Development, and Investment Promotion Minister Mthuli Ncube on Thursday announced a series of new taxes aimed at increasing government revenue to address rising financial demands, further burdening an already strained taxpayer base.
The new taxes outlined in the budget, which are effective January 01, 2025, will target sectors including betting, fast food, and plastic bags, among others.
Below are the new taxes in the 2025 National Budget:
<ul>
<li>Fast Food Tax – a 0.5% tax on the sales value of fast food items like pizza, burgers, chips, tacos and hot dogs.</li>
<li>Betting Tax – a 10% withholding tax on the gross winnings of sports betting punters.</li>
<li>Plastic Bag Tax – a 20% tax on the sale value of plastic bags.</li>
<li>Rental Income Tax – a 25% tax on the rental income of properties converted from residential to business use.</li>
<li>Capital Gains Tax on Marketable Securities – a 1% tax on marketable securities.</li>
<li>Excise Duty on Alcoholic Beverages – excise duty on alcohol increased from USD 0.25/litre to USD 0.30/litre.</li>
<li>Royalties on Quarry Stones – quarry stones will attract a royalty rate of 0.5% of their sales value.</li>
<li>Corporate Income Tax on Building Societies – receipts from non-mortgage activities by building societies will now be taxed.</li>
<li>Mandatory Tax Registration for Emerging Sectors – small businesses including car dealers and hardware operators must register for taxes, failing which specific quarterly corporate tax payments will be levied against them.</li>
</ul>
Former MP for Mt Pleasant, Fadzayi Mahere, criticized Minister Mthuli Ncube for increasing the tax burden on citizens while enjoying a lavish lifestyle. She wrote on X:
<blockquote>
You drive the latest big bad Range Rover for which you paid 0% import duty yet you make a budget statement that squeezes every drop of blood from the taxpayer!
You’re not even ashamed that the country has a ballooning debt of over US$21 billion, you cannot afford to pay teachers or that you rely on food handouts during a drought!
To cap it all off, your solution to the economic crisis is to tax chicken and chips, njuga and rental income. No wonder ZESA protested after you spoke by turning the lights off as a sign of the darkness to come.
The economy is dead and the country is on auto-pilot. The Budget is anti-people, anti-productivity and anti-progress. It’s a mess.
</blockquote>
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Zimbabwe's government has introduced new taxes to get more money from people. The taxes will start in 2025 and target things like fast food, betting, plastic bags, rental income, and more. Critics say the government is making life harder for citizens while they live fancy lives. They worry about the country's big debt and the struggling economy. The new taxes are causing a lot of anger and frustration among the people.

Zimbabwe Unveils New Tax Measures, Increasing Burden On Already Strained Taxpayers

On November 30, 2023, Professor Mthuli Ncube, the Minister of Finance, Economic Development, and Investment Promotion, delivered the 2024 National Budget Speech titled “Consolidating Economic Transformation.” Ncube raised taxes and introduced more new ones. The ZW$40 trillion budget is still awaiting adoption. The budget will be debated and passed or rejected by Parliament. Here are some key points from the speech:
– Ncube suggested that the Tax-Free Threshold should be reviewed to Z$750,000 per month or Z$9,000,000 per year. Additionally, the tax bands will be adjusted to end at Z$270 million per year. Any income above this amount will be taxed at a rate of 40%. These changes are proposed to take effect from January 1, 2024.
– The tax-exempt threshold on withholding tax for agricultural commodities like soya beans, sunflower, groundnuts, and cotton seed will be increased from US$1,000 to US$5,000 per year.
– Safari and Tour Operators will continue to have a duty suspension on new motor vehicles imported for another 2 years starting from January 1, 2024.
Screws On Tax Evaders:
– Only licensed and tax-compliant operators will be allowed to procure goods from manufacturers and wholesalers to restore the supply chain.
– Traders must be registered for VAT and possess a valid Tax Clearance Certificate to buy goods from manufacturers.
– The VAT registration threshold will be lowered to US$25,000 from January 1, 2024, and businesses meeting this threshold must register and account for VAT.
– The Domestic Minimum Top-Up Tax (DMTT) will be introduced to prevent ceding taxing rights to foreign jurisdictions on tax incentives given to investments.
– A 30% surcharge on high-value motor vehicles will continue for wealth redistribution purposes.
Mining:
– All documents or agreements for the transfer, disposal, or lease of mineral rights must be reviewed and approved by the State before concluding the transaction.
– Mining rights cannot be transferred without paying capital gains tax, stamp duty, or other applicable taxes.
– Revenue from privately disposed mining rights will be shared equally with the State.
– Measures will be introduced to track the movement of mining rights, and a register of mining rights will be maintained by the Zimbabwe Revenue Authority.
– The Strategic Reserve Levy on diesel and petrol will be increased, as well as toll fees on premium roads.
Need a new Passport or Register a Vehicle?
– Passport and Central Vehicle Registry fees will be increased.
– A wealth tax of 1% will be levied on residential properties with a minimum value of US$100,000, with exemptions for principal private residential properties owned by elderly persons above 70 years.
– A digital platform will be explored to combat illicit trade in cigarettes and provide real-time data on locally manufactured goods.
– A digital platform will be explored to combat illicit trade in cigarettes and provide real-time data on locally manufactured goods.
– Additional revenue generated from the proposed measures will be allocated to road infrastructure development.
Do you own a home? There’s a Tax now:
– A wealth tax of 1% will be imposed on the market values of residential properties with a minimum value of US$100,000, with exemptions for elderly individuals above 70 years.
– The growth of illicit trade, particularly in cigarettes, has negatively impacted revenue growth, and a digital platform will be explored to address this issue.
Do you drive a car? Fuel has gone up!
– The Strategic Reserve Levy has been raised by US$0.03 and US$0.05 per litre of diesel and petrol, respectively, with effect from 1 January 2024.
Want to buy Soft Drinks (Kambucha, coke, etc) there is a tax now!
Ncube introduced a levy on the sugar content of beverages saying it was in response to concerns about the negative effects of consuming sugary drinks, which are linked to health problems. He said:
– The aim is to discourage the consumption of high-sugar beverages.
– The proposed levy is US$0.02 per gram of sugar in beverages, excluding water.
– The levy will take effect from January 1, 2024.
– The funds generated from this levy will be used specifically for cancer therapy and the procurement of diagnostic equipment.
Are you a civil servant? Your $300 Covid allowance is now taxable!
– As part of the remuneration review process for civil servants, the Government will convert the current COVID and Cushioning allowances, aggregating to US$300, to be part of the pensionable.  This means that these allowances will now be considered when calculating the pension benefits for civil servants, potentially increasing their retirement benefits and tax too.
Want to travel out of town? Toll Fees doubled with effect from 1 January 2024!
– Light Motor-Vehicles: 
– Current fee: US$2 
– Proposed fee on Premium roads: US$5 
– Proposed fee on other roads: US$4
– Minibuses (kombi): 
– Current fee: US$3 
– Proposed fee on Premium roads: US$8 
– Proposed fee on other roads: US$6
– Buses: 
– Current fee: US$4 
– Proposed fee on Premium roads: US$10 
– Proposed fee on other roads: US$8
– Heavy Vehicles: 
– Current fee: US$5 
– Proposed fee on Premium roads: US$15 
– Proposed fee on other roads: US$10
– Haulage Trucks: 
– Current fee: US$10 
– Proposed fee on Premium roads: US$25 
– Proposed fee on other roads: US$20
<h3><a href="https://www.pindula.co.zw/">More Pindula News</a></h3>

Zimbabwe 2024 National Budget: Passport, Vehicle Registration, Toll Fees Raised, Tax For Soft Drinks

Minister of Finance and Economic Planning, Patrick Chinamasa has conceded that Zimbabwe’s taxation is too high and said that the government was looking into the matter. Chinamasa revealed this when he responded to a question in Namibia where he had accompanied President Emmerson Mnangagwa. Chinamasa said that the government wanted to encourage investment in the country by lowering the taxes.
Said Chinamasa:
<blockquote>Taxation, I agree with you is too high.
It’s a matter that we are going to address so that we can proceed to a position where we get more taxes from more volumes.</blockquote>
More: <a href="http://www.herald.co.zw/govt-to-lower-taxes/">Herald</a>

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