Government to strengthen local currency usage
Pretty Manyewe
Government has outlined new measures to improve the wider domestic use of the local currency.
Government, through various agencies, is presently seized with instituting various measures to enhance the formal use of the domestic currency.
In a Public Advisory note issued today, Minister of Finance and Economic Development, Professor Mthuli Ncube revealed that new incentives will be put in place to encourage its wider use and acceptance in all facets of the economy.
“Whilst foreign currency auction system has provided a platform for the continuous and sustainable use of the local currency by individuals and corporations. It is now imperative to expand the areas which the Zimbabwean Dollar should be used in the economy and further provide incentives for its use,” said Minister Ncube.
“In this regard the public is advised that the following measures now apply with immediate effect. All mining royalties are now payable in Zimbabwe Dollars up to a limit of 50% of royalties due. 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.”
“All domestic taxes due from export receipts are now payable in both forex and local currency in direct proportion to the approved export retention levels. As an example, an exporter who receives foreign currency of say US$1000 at a 40% surrender ratio 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 Zimbabwean dollar and to continuously strengthen the economy so as to build long lasting macro-economic stability.
Over the past forty months 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 destabilizing fiscal deficits despite major economic shocks.
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