ZIMBABWE’S economic troubles, as epitomised by the demise of the industrial sector and the informalisation of the economy, have perturbed government as much as it has disturbed the general public.
Government has been particularly concerned by the dwindling revenue base for the fiscus; the situation appears to be worsening rather than improving, creating the real possibility of government bankruptcy.
Such a prospect would be both discomforting and embarrassing to both government bureaucrats and ruling party elites, for it would be an indictment on the way this economy has been managed or, put more bluntly, mismanaged.
Poverty has worsened as a result of the economic decline, and most Zimbabweans are being pushed into the informal sector to eke out an honest living.
The truth is that there is not much money being made in this sector, as government would want us to believe; informal sector businesses are struggling with the continued decline of the economy.
Moreover, many people are in the informal sector not out of choice but due to economic circumstances. They would want jobs that give them income and security, as well as medical aid cover and pension.
It was therefore shocking to hear Finance Minister Patrick Chinamasa saying last week in Parliament that he would track down all informal business operators to collect tax allegedly outstanding since dollarisation of the economy in 2009.
These informal business operators include tuck-shop owners, who are now supposed to pay a US$300 quarterly tax in line with the minister’s 2015 National Budget statement issued last year.
Now, that is surely a lot of money; most tuck-shop owners are barely surviving; there is not much being generated from their small businesses but just enough to get by.
Chinamasa points out that there has been “a structural shift from formalised employment to informal sector and that is what has eroded our tax revenue base”.
He should surely be ashamed to admit such a monumental failure in managing this once-prosperous economy.
Why has there been this structural shift? Are businesses to blame? Why are people resorting to operating tuck-shops, selling vegetables and mobile phone airtime on the streets? Is this the life they prefer?
If Chinamasa was to be honest in answering these questions, he would certainly come to the conclusion that government has ruined the livelihoods of its citizens and industries through poor policy implementation as well as corruption in high places that has discouraged investment and benefitted neighbouring countries like South Africa for which we have become a supermarket for their products.
Pursuing informal traders would really be a desperate measure for a desperate government trying to get its books in order.
But that would be another disastrous policy decision that could precipitate social instability by further impoverishing the long-suffering masses.
Government should get our industries working again; it should start by reviving the agricultural sector which was ruined by our chaotic land redistribution programme. Clamping down on vendors and other informal businesses will not help us turn the corner.
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EDITORIAL/Resuscitate industries
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