Authorities has raised the tax-free threshold to $5 000 up from $2 000 month-to-month while those incomes above $100 000 will pay 40 p.c tax with effect from next month, Finance and Economic Development Minister Professor Mthuli Ncube stated yesterday.
Presenting the 2020 Mid-term fiscal policy assertion in Parliament, Prof Ncube stated the tax-free threshold assessment was meant to cushion staff from excessive inflation induced by wage and salary increases.
Not too long ago, the Authorities reviewed upwards the wage of its workforce from about $2 500 to $8 000 for the bottom paid worker. Whereas all sectors of the economy had been affected by the Covid-19 pandemic, there is variation by way of severity, with sectors such as tourism, non-food manufacturing, mining, monetary services, transport and distribution and education being adversely affected. However, health services, ICT, manufacturing of food stuffs and electricity and water had beneficial gains.
The Minister announced that staff had been being cushioned through increasing tax-free thresholds. “In an effort to cushion staff from inflation induced by wage and salary adjustment, I suggest to assessment the tax-free threshold from ZWL$2000 to ZWL$5000 per thirty days. I additional suggest the tax band to start at ZWL$50001 and end at ZWL$100 000 above 40 p.c will apply and this is with effect from 1 August 2020,” he stated.