How Mthuli Ncube’s 2021 budget will affect you

If you were planning to import a car

Government will now control the importation of cars that are 10 years or older. Owning a car has just slid further from the reach of the majority, who cannot afford new vehicles. According to Mthuli, Zimbabwe has spent around US$1.3 billion importing buses and used cars over the past five years. Cars older than 10 years are now off the Open General Import Licence. This means that, from 2021, you will need a special import licence for older cars.

This doesn’t apply to commercial vehicles, such as trucks, tractors and earthmoving equipment used in mining or construction.

If you are a self-employed professional

It’s going to be a tough year for you, if you don’t have tax clearance. As government chases more tax dollars, you must budget for really high taxes. If you are a doctor, engineer or lawyer, you will have to pay $500 000 in presumptive tax per month. Architects pay $250 000. Realtors will have to work overtime – the tax is $1 million per month.

If you run a small flea market or downtown shop

Government is shaking down everyone. This includes those of you running small stalls at places such as the Gulf Complex in Harare. You will now be charged tax of the equivalent of US$30 per month for your unit. If you run a hair salon, you now pay $2 500 per month. A restaurant or your favourite bottle store is now required to pay $10 000 per month in taxes.

If you’re a landlord of a complex housing flea markets, stalls

Apart from chasing after rent, landlords now have an extra job; making sure tenants pay the presumptive tax. If you are a landlord and your tenants don’t pay this tax, you will pay a penalty equivalent to the amount of tax payable – plus interest.

To make it easier for ZIMRA tax inspectors, landlords of these commercial sites will need to keep a record of their tenants.

A new, special unit will be formed at ZIMRA to target the informal market.

Continued next page

(539 VIEWS)