2024 Budget Balances Relief for Workers, Bolstering Revenues

Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube arrives for the 2024 National Budget presentation at New Parliament Building yesterday. — Picture: Joseph Manditswara.

Martin Kadzere-Senior Business Reporter

The cocktail of tax measures introduced by Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube yesterday in the 2024 Budget strikes a balance between providing relief to workers by raising the thresholds of tax-free income, bonuses and taxes on smallholder deliveries, while bolstering Government revenues to finance the economic development and infrastructure of Zimbabwe. The tax measures are part of a comprehensive strategy aimed at easing the financial burden on taxpayers and using fiscal policy to tame speculation, bring the tuckshops and much of the informal sector into the main economy while simultaneously boosting the Government’s capacity to generate more revenue to support essential socio-economic programmes. Unveiling the 2024 National Budget that largely reflects the Government’s commitment to fostering a more equitable society, consolidating stability and driving economic growth, Minister Ncube proposed to raise the monthly tax-free threshold from $500 000 to $750 000, resulting in an annual tax-free threshold of $9 million and adjusting other tax bands so that the highest tax rate of 40 percent applies only to annual income exceeding $270 million. Regarding the local currency bonus tax-free threshold, he proposed to increase it from $500 000 to $7,5 million, meaning that almost everyone in formal employment will get their entire bonus tax free. The proposed new tax thresholds would be effective from January 1, next year while the bonus tax-free threshold would take effect from November 1, 2023. The widening of the bonus tax bands will provide much-needed relief to many employees, particularly low-income earners allowing them to retain a larger portion of their hard-earned money and boost their spending power, overcoming the “band creep” of the fairly low monthly inflation seen since mid-year when the last major adjustment was made. ReadMore