Finance Minister Mthuli Ncube Raise Intermediated Money Transfer Tax

Finance Minister Mthuli Ncube Raise Intermediated Money Transfer Tax

Professor Mthuli Ncube, Minister of Finance and Economic Development, has stated that the Intermediated Money Transfer Tax on domestic foreign currency transactions has been raised from 2% to 4% in order to encourage the use of the Zimbabwe dollar.

Analysts advocated for the repeal of the “regressive tax” in order to “reduce the massive tax load.”

However, in his 2023 Budget address at the newly constructed multi-million dollar Parliament Building in Mt Hampden, Ncube stated that the tax had been hiked.

He stated:

Mr. Speaker Sir, in order to promote usage of the local currency, Government increased Intermediate Money Transfer Tax (IMTT) on domestic foreign currency transfers from 2% to 4%.

It has, however, been observed that some entities are now preferring to settle transactions in cash instead of electronic transfers.

In order to promote use of the banking system, I propose to align the IMTT on foreign currency transactions to local transactions.

Exempt Transactions

In order to mitigate against higher wheat prices and consequently the price of bread and other wheat products, I propose to exempt from IMTT, the transfer of funds to farmers, for the purchase of wheat by private off-takers approved by the Agricultural Marketing Authority, for the period 1 September 2022 to 31 March 2023.

In other news,

Value-Added Tax Deferral Minimum Threshold Raised To $1 Million

 

Finance Minister Mthuli Ncube said that the minimum threshold for VAT deferral has been raised from US$500,000 to US$1 million.

The government approved a temporary exemption from paying VAT on selected capital items imported by enterprises in the manufacturing, agricultural, mining, aviation, transportation, and health sectors.

Ncube stated that the facility was being overused in his national budget presentation for 2023…continue reading