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Govt Announces New Measures To Promote Use Of The Zimbabwe Dollar

Govt Announces New Measures To Promote Use Of The Zimbabwe Dollar

The Government has announced new measures to promote the domestic use of the Zimbabwe dollar as economic analysts predict the “second death” of the local currency in the near future.

In a public advisory note issued on Friday, 04 February 2022, Finance and Economic Development Minister Mthuli Ncube said that all duties and taxes on the importation of designated motor vehicles are now payable in Zimbabwe dollars again up to a limit of 50% of duties and taxes payable. Pindula News is publishing Ncube’s statement in full:

PUBLIC ADVISORY NOTE ON MEASURES BEING INSTITUTED BY GOVERNMENT TO ENHANCE THE DOMESTIC USE OF THE ZIMBABWE DOLLAR

BACKGROUND

1. Government, through various agencies is presently seized with instituting various measures to enhance the formal use of the domestic currency.

2. These measures are also aimed at stemming illegal trade in foreign currency and its associated twin; that of parallel market benchmarking or indexation of prices of goods and services at parallel market exchange rates.

3. The continuation of these practices, which have been identified as significant contributors to price instability in the economy and are imposing downside risks to macro-economic stability, and the erosion of domestic and international competitiveness.

4. Over the past 40 months, the government has instituted numerous initiatives to bring macro-economic stability. These include fiscal consolidation which has resulted in balanced budget performance and the elimination of destabilising fiscal deficits despite major economic shocks such as the 2019-20 droughts, cyclone Idai and the ongoing threat of the COVID-19 pandemic.

5. Furthermore, the restoration of domestic and export competitiveness through the reintroduction of the Zimbabwe dollar, has seen rapid gains being made in stabilising the current account, which has also been boosted by increased international remittances, enhanced export performance and notable import substitution effects.

6. Consistent implementation of the monetary targeting framework by the Reserve Bank of Zimbabwe as well as close policy coordination between fiscal and monetary authorities have been key policy milestones towards achieving price stability.

7. These developments have also seen the rapid growth of privately-held foreign currency reserves from levels of around US$300 million in 2018, to over US$2 billion currently held in Zimbabwean banks. Official reserves have also increased from less than US$100 million to over US$1.2 billion currently, which includes, the US$960 million equivalent in SDRS recently availed by the IMF to Zimbabwe.

8. In the intervening period, the government has also improved access to foreign currency by all bona fide businesses and individuals through the auction system.

9. Whilst the foreign currency auction system has provided a platform for the continuous and sustainable use of local currency by individuals and corporations it is now imperative to expand the areas in which the Zimbabwe Dollar should be used in the economy and further provide incentives for its use.

10. In this regard, the public is advised that the following measures now apply with immediate effect:

a. All mining royalties are now payable in Zimbabwe Dollars up to a limit of 50% of royalties due.

b. All duties and taxes on the importation of designated motor vehicles are now payable in Zimbabwe dollars again up to a limit of 50% of duties and taxes payable.

C. All domestic taxes due from exporters on their export receipts are now payable in both foreign and local currency in direct proportion to the approved export retention levels. As an example, an exporter who receives foreign currency of say USD1 000.00 at a 40% surrender ratio (60% retention) will pay taxes on the 40% in Zimbabwe dollars and the 60% in foreign currency.

These measures reflect Government’s commitment to promote the wider use of the Zimbabwe Dollar and to continuously strengthen the economy so as to build long-lasting macro-economic stability.

This advisory note was issued in the public interest.

More: Pindula News


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16 Comments

Dzvamu 3 months ago

Noble thing to do, just remove the worthless paper. Anchor the economy onthe much loved US dollars. Let the markets decide on their own.


Tk 3 months ago

Mutuvi usajairire vanhu iwe nekuti takuenda kuma elections makuda kutibata kumeso siyana nesu musorobhanku


Elyse 3 months ago

Thank you Minister...you are one of the best finance ministers in e whole world...musacheuka miridzo


NHM 3 months ago

Kuora ndokuziva hangu


2 3 months ago

Makadii kuzviita kumasure kwese uko makuona kut mapepa enyu akuda kurashwa makuda kubata vanhu kumeso. Hapana munhu achamboda mapepa enyu , ko fuel ye rtgs yamakativimbisa irikuwanika kupi


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Voltz JT 3 months ago

Mthuli naMangudya vanoda kumbomamiswa chete


Tkt 3 months ago

@Gabadela just send her the money in her Ecocash ukanzwa vakuti haikwani woziva kuti ikushandawo kwavari ikoko


Gabadela 3 months ago

How do I explain this kuna Mbuya vangu variku Chombhobho ku Mberengwa uko🙆🏽‍♂️🙆🏽‍♂️


Major Seer1 3 months ago

🤣🤣🤣🤣🤣🤣🤣🤣

Tkt 3 months ago

Weldone Profesor, that's it in short. Ndinzwe rino mama ktaura nezve comment yangu, ku..... Kwako


Peaceful 3 months ago

Hapana anomama asi iwe uri kumama. We know nothing will succeed. Zvavakuda Biti izvi

...... 3 months ago

Bvuma wasakara, bvuma wachembera....


Mhazi of silobela 3 months ago

We don't use rubbish


Yvt 3 months ago

Trying to delay the inevitable. It will not work, the economy has dollarised. These are the last kicks of a dying horse.

Makelanwi 3 months ago

KoIsu anaKamba timokwana papi, Mr Vostro njuga apa dzakuremerai


SWAT 3 months ago

Chaora chinhu ichi. Dzangova nharo hadzo



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