2015 Mid-Term Fiscal Policy Review highlights

Finance minister Patrick Chinamasa delivered Zimbabwe’s Mid-Term Fiscal Policy review today. Below are the highlights

• GDP growth rate at 1.5 pct from 3.2 percent.
• Revenue projection revised to $3.6bn from $3.99bn. Expenditure revised from $4.1bn.
• Budget deficit seen at $400mln.
• Agricultural sectors performance for 2014 below expectations owing to poor rains and expected to further decline by 8.2 percent.
• Mining expected to grow by 3.5 percent on higher mineral output.
• Prevailing double digit lending rates preventing the recovery of manufacturing output
• Power tariffs for tourism, mining and manufacturing pegged at 6 cents/KWH
• Salary arrears at government parastatals – NRZ $140.1mln, Air Zimbabwe $136.4mln and GMB $20mln.
• Tourism sector to grow by 5 percent.
• H1 exports receipts grew 0.4pct to $1.3bn, imports up to 2pct to $3.1bn.
• Civil service retrenchments on the cards as government bids to bring the wage bill down to 40pct of expenditure.
• Government costs currently at $2.07bn as government channels 83 cents of every dollar obtained to salaries.
• Public and publicly guaranteed debt at $8.4bn as at June 2015.
• Capital expenditure at $31.4mln.
• Government bans importation of second hand clothing and shoes.
• Royalties for small-scale gold miners to 1pct from 3pct effective September.
• Finance minister extends tax amnesty by 4 months to October.
• Basic good removed from travellers rebate effective 1 August.
• Church taxes and tithes exempt from taxes.
• Surtax on second hand light motor vehicles – 5 years and older raised to 35pct from 25pct from September 1.

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