JCTR foresees difficult times ahead for Zambians

The Jesuit Centre for Theological Reflection says not much improvement in people’s lives is expected in 2019. JCTR stated yesterday that it was very likely that poor people will continue to suffer given that the cost of living has been increasing whilst incomes for many are likely to remain static.

Last Friday, finance minister Margaret Mwanakatwe presented a K86.8 billion 2019 national budget. In her presentation, Mwanakatwe said in national development no one should be left behind. She also reiterated the fact that Zambia’s economic growth had been below its potential and poverty levels remained high. JCTR stated that overall, the proposed measures in the 2019 budget would not significantly improve the lives of ordinary people.

“While JCTR acknowledges measures such as increase in sliding mineral royalty tax, the informal sector has been almost let scot free besides measures such as base tax announced in last year’s budget,” it stated. “Measures to improve administration of the informal sector taxes need to be explored. The budget should also have provided more incentives for local industrialisation. Other than creation of industrial economic zones, the budget has not offered much on how it will industrialise the economy and create jobs. The budget also has no relief to workers as they continue to bear the burden of generating tax revenues through Pay As You Earn.”

It stated that in as much as the 2019 national budget makes some strides to bring back the country on the right path to development, JCTR observed that not much improvement in lives of people was expected in 2019.

“Among the measures the Centre sees as progressive in the proposed budget include: the increase by 1.5 per cent on a sliding mineral royalty tax of four to six per cent; the introduction of 10 per cent tax when the price of copper exceeds US$7,500 per tonne; the introduction of 15 per cent export duty on precious metals, including gold, precious stones and gemstones, and the increment of export duty on manganese ore and concentrates from 10 to 15 per cent. JCTR welcomes these measures as avenues that will increase domestic resource mobilisation,” JCTR stated.

It further welcomed the increase in excise duty on plastic bags from 20 to 30 per cent.

“Apart from viewing this as a revenue measure, JCTR sees this as a constructive measure of discouraging rampant use of plastics that have proved to be very detrimental to the environment,” JCTR stated.

It also welcomed the reduction in corporate income tax from 35 to 15 per cent on companies that add value to copper cathodes. The centre stated that the measure would encourage value addition to copper and promote industrialisation and subsequently widen employment opportunities. However, JCTR cautioned that increased industrialisation and widened employment opportunities would not be seen in the short and medium term.

Source: The Mast

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