Opposition Movement for Democratic Change legislator Eddie Cross says the government must scrap allowances for civil servants because they are tax free and increase their salaries instead because this will raise more revenue for the government and at the same time cut the government wage bill.
In his contribution on the 2016 budget review presented by Finance Minister Patrick Chinamasa last week, Cross said the government had to reduce its expenditure as a matter of urgency otherwise the country was going to slide to the hyperinflation of 2008.
“We have to reduce expenditure on salaries to lesser than 60% of our revenue,” he said.
“That could be achieved quite easily by simply cancelling allowances to civil servants.
“ In fact, if we cancel the allowances to civil servants we could increase salaries.
“The reality is that allowances are not taxed, and salaries are.
“This could increase the tax revenue to the State and it would bring our expenditure on personnel down below the threshold of 60%.”
The Bulawayo legislator also said government should collect all the customs duty it has to because right now it was collecting less than 5 percent of its dues.
“Mr. Speaker that is a ridiculous figure, and it points to massive leakages at the border posts on a scale which simply staggers the imagination,” he said.
“Last year, we imported US$1.4 billion worth of motor vehicles.
“If you take the customs duty on that alone, it exceeds $600 million, more than double the total customs revenue on all trade.
“This suggests to me Mr. Speaker that we should be able to push our border revenue from US$384 million a year, to something approaching a billion, without affecting any other sectors of the Zimbabwean economy."
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