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Mid-term fiscal policy review: Two bills passed - Bill Watch 29/2010
July 18, 2010
The House of
Assembly has adjourned until 5th October, the Senate until 12th
Week in Parliament
- The President
opened the Third Session of the Seventh Parliament. [See Bill
Watch 28 for highlights of the President’s speech, and
details of the legislative agenda he announced for the new Session.]
- The Speaker
announced that all Parliamentary committees remain the same, except
for a new member for the Parliamentary Legal Committee [PLC] and
new chairpersons for three portfolio committees. [See further
of Finance Tendai Biti presented his Mid-Term Fiscal Policy Review
Statement and also tabled Amended Estimates of Expenditure for
- Both Houses
approved motions suspending various Standing Orders to permit
the fast-tracking of the two Bills needed to give effect to the
Fiscal Policy Review and Amended Estimates of Expenditure.
- The House
of Assembly debated the Fiscal Policy Review, approved the amended
Estimates of Expenditure and passed both Bills without amendment.
- Two Bills
were passed – the Finance Bill, to give effect to the Minister’s
taxation and revenue proposals, and the Appropriation (2010) Amendment
Bill, to give effect to the approved Estimates of Expenditure.
[See below for highlights of the Fiscal Policy Review Statement.]
- The House
then adjourned until Tuesday 5th October, leaving the Senate to
deal with the Bills on Friday.
- The Senate,
which had met for only a few minutes on Wednesday and Thursday,
passed both Bills without amendment. [The next step is for these
two Bills to be sent to the President for his assent before they
can be gazetted and become law as Acts.]
- The Senate
then adjourned until Tuesday 12th October.
Estimates of Expenditure for 2010
stressed that he was not presenting a supplementary Budget or supplementary
Estimates of Expenditure, he was merely proposing adjustments and
re-alignments in certain Ministry votes, with no change to the original
budget of an overall revenue and expenditure [of US$2.25 billion
for 2010]. So the estimates he tabled are entitled the Amended Estimates
of Expenditure for the Year ending 31st December 2010. Amounts allocated
to Ministries in the Amended Estimates have either increased slightly
or remained the same. This is because, although there are cuts in
expenditure on programmes financed from international aid grants
through the Vote of Credit [from US$810 million to $500 million]
this is counterbalanced by the improvement in tax revenue collections
which is expected to continue.
of Fiscal Policy Review
available, but please note that it is a 1.2MB pdf document]
for economic growth:
- A reiteration
that the rule of law, restoration of basic freedoms and democracy
are a necessary precondition for sustained economic recovery,
making it “imperative” that there be implementation
of agreed positions in the GPA
around issues of the rule of law, the Constitution, security of
persons and prevention of violence, and on freedom of expression
that without title deeds or secure 99-year leases recognised in
and in Acts of Parliament, land will remain “dead capital”
and significant growth in Zimbabwe’s agriculture-dependent
economy will remain unrealised.
of concerns raised on the “inflexibility” of current
labour laws, resulting in unsustainable salary and wage obligations,
and necessitating a review of labour laws within the context of
the Social Contract.
in first half year:
revision of estimated GDP growth for the year from the original
7% to 5.4%
economic activity has resulted in increased tax revenue collections,
with a projected increase for the year of $300 million.
- The “under-performance”
of the Vote of Credit, i.e., limited cooperating partner support
for mostly infrastructure and social protection programmes in
health, education and rural development,. This has resulted in
Government’s being unable to undertake some programmes,
including Public Sector Investment projects and provision of certain
social services in the health and education sectors.
- A projected
increase in inflation, with the year-on-year rate having risen
to 6.1% in May and the rate for the year revised to 4.5%.
- No pay rise
for civil servants or MPs, but a slight rise in the income tax
tax-free threshold, from US$160 to US$175, will enhance take-home
of customs duties on essential commodities will continue to the
end of 2010, with the exception of a few commodities now being
produced in sufficient quantities by local industry.
gains tax reduction on unlisted securities.
of customs duty on items related to solar energy – solar
panels, inverters, etc. with effect from 1st August.
on precious metals will go up from 3.5% to 4% with effect from
- Export tax
on chrome ore and fines will increase to 20% with effect from
- A “tax
amnesty” for some corporate bodies, details to be spelled
out later in regulations.
of smaller denomination foreign currency to facilitate the notes
and coins, to relieve problems experienced in cash transactions.
of Government revenue from diamond mining, to be achieved by a
proposed Diamonds Act and amendments to the Zimbabwe Mining Development
to Parliamentary Committees
The Prime Minister’s
reshuffle of MDC-T Ministers and Deputy Ministers included the appointment
of back-benchers to Ministerial and Deputy Ministerial posts. This
in turn necessitated changes to membership and chairing of four
Parliamentary Committees because Ministers and Deputy Ministers
cannot serve on Parliamentary committees. The changes are as follows:
Legal Committee: Hon Innocent Gonese MDC-T is the new member
of the PLC, replacing Hon Senator Obert Gutu who is now the Deputy
Minister of Justice and Legal Affairs. The PLC will choose its own
Accounts Committee: Hon. Webber Chinyadza of MDC-T is the
new chairperson, replacing Hon Tapiwa Mashakada who is now Minister
of Economic Planning and Investment Promotion.
Committee on Justice, Legal and Parliamentary Affairs:
Hon Douglas Mwonzora of MDC-T is the new chairperson, replacing
Hon Tongai Matutu who is now Deputy Minister of Youth, Indigenisation
Committee on Media, Information and Publicity: Hon S. Moyo
of MDC-T is the new chairperson, replacing Hon Gift Chimanikire
who is now Deputy Minister of Mines and Mining Development.
No Bills or
statutory instruments were gazetted last week.
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