Manual Invoices from Taxpayers who use the EFD are not accepted. Equally, issuing two tax invoices for the same transaction using both manual and EFD invoices is not allowed

7 / Daily Nation, Tuesday 1 September, 2020 ZIM CUTS WAGE BILL TO BELOW 50PC

HARARE - The Government has managed to bring down the proportion of the public wage bill in the national budget from 92 percent in 2017 to below 50 percent, resulting in fiscal surpluses that have been invested in other key areas, Treasury said in a recent update.

The progress report contains a summary of the extensive progress the New Dispensation has recorded on a wide range of economic and Government reforms since coming into power in November 2017.

The Government promised to eradicate corruption and other forms of vices that have been scuppering efforts to turn around the economy and indeed it has lived to its word.

Significant milestones have been recorded on reforms cutting across disciplines that include the general economy and specifically areas such as mining, key infrastructure (roads, airports, new parliament building), education system, agriculture, power generation, political and legal systems.

Most of the reforms thus far have come through under the transitional stabilisation programme (TSP), which ends this year and will be succeeded by the first five-year development plan.

The TSP sought to achieve

Prof. Mthuli Ncube

macro-economic stability, lay foundation for private sector led sustainable growth, further democratise the country, normalise international relations, develop infrastructure, improve public and social service delivery and provide social protection.

According to the update statement, “public wage bill (is) now below 50 percent of total revenues from 92 percent in 2017,” which creates funding space for other critical areas like capital and social service programmes that infrastructure, healthcare service and education services.

Measures that have been instituted to streamline public expenditure on wages and salaries, have included rationalisation of posts and freeze on hiring except for critical areas like healthcare.

In 2019, the International Monetary Fund noted the Government’s commitment to realign fiscal expenditure, which it said has largely focused on containing the public wage bill through restrained wage adjustments.

“As a result, savings were generated from a five percent pay cut in the salaries of senior Government officials, rationalisation of the civil service, and the limiting of the civil servants 13th cheque to the basic salary.

“The authorities also introduced biometric verification of civil servants, which is expected to help further contain the wage bill.

“They halted expenditure overruns to rein-in the budget deficit and scaled back central bank borrowing.” – THE HERALD.

Brazil says is confident U.S. steel quota to be lifted in time

BRASILIA/RIO DE JANEIRO - Brazil believes steel import quotas recently imposed upon the nation by the United States will be lifted as market conditions improve, the foreign ministry said in a statement at the weekend.

Late on Friday, the White House announced that it was re-imposing import quotas on certain Brazilian steel products, as domestic producers deal with a slumping market.

In Brazil’s Saturday statement, the Foreign ministry acknowledged the decision, adding that dialogue over the matter would resume in December.

“The Brazilian government maintains a strong belief that the recovery of the U.S. steel sector, frank and constructive dialogue regarding the matter - to be taken back up in December - and the exceptional quality of bilateral relations will allow the full reestablishment and even intensification of trade in semi-finished steel,” the ministry said. – REUTERS.

Manufacturers seek regulations audit to end duplication

NAIROBI - Kenya Association of Manufacturers (KAM) Vice Chairman Rajan Shah said while regulations should create a predictable environment for businesses to thrive, the current set is predatory, allowing the national and the county governments to tax manufacturers at source as well as during delivery of goods across counties.

“We pay levies within host counties while our distributors also pay levies to their host county governments, but ideally we should not be charged a levy for distribution and garbage disposal every time our goods enter a county,” said Shah.

Counties have in the past seven years struggled to raise their own revenue to supplement allocations from the exchequer.

Manufacturers have been easy targets, with counties imposing several fees to allow them to operate in their territories.

To promote competitiveness and a level playing field, KAM has been calling for establishment of a high level government

Mr Shah

approval process for any regulatory agency (county governments and regulatory agencies) imposing corrective measures touching on businesses.

The industrialists in their Manufacturing Priority Agenda 2020 (MPA2020) launched last March said counties should be discouraged from introducing no-service linked fees, charges and levies.

Besides the double taxation, Shah also said the blanket one percent turnover tax introduced this year by the National Treasury should be differentiated between loss-making firms and those failing to declare profits due to heavy investments.

He said the indiscriminate taxation will hurt those who are investing in the growth of their businesses.

On energy costs, Shah urged the government to adopt a comparative pricing strategy, noting that high costs were hurting the country’s competitiveness in the region.

Ethiopia and Egypt charge manufacturers three cents per kilowatt hour and Uganda 10 cents, while Kenya charges up to 20 cents per kilowatt hour.

“Manufacturers in Kenya cannot therefore compete on equal footing with manufacturers exporting goods to Kenya,” he said.

He said money spent on capital investments ought to be tax deductible, since it creates more jobs and hence new revenue streams for the government.

“The review on 150 per cent investment deduction allowance for upcountry investments has reversed gains made in attracting investors to the counties,” he said. – DAILY NATION,

Kenya.

Treasury researches wealth taxes amid threat of ‘debt distress’

JOHANNESBURG - National Treasury is conducting research on wealth taxes, and has already started working out how to implement zero-based budgeting, members of the National Economic Development and Labour Council heard.

The council was last week briefed by Treasury’s deputy director general Edgar Sishi on the economic and fiscal considerations for the 2020 medium term budget policy statement.

Echoing the supplementary budget, tabled in June, Treasury’s presentation, seen by Fin24, warned of a debtto-GDP ratio exceeding 90 percent.

It noted that if “active measures” are not taken, a debt crisis in the form of a “debt distress episode” or a “permanent squeeze of the investment channel” will follow.

Under a fiscal crisis, interest on debt alone could take up 39 percent of main budget revenue.

If South Africa takes active steps to ensure fiscal consolidation and economic reforms, debt could stabilise by 2023/24 – this will require spending cuts and revenue adjustments amounting to approximately R250 billion over the next two years, the presentation read.

This includes spending reductions of R230 billion in 2021/22 and 2022/23, with the wage bill being a “key area” to meet fiscal targets, Treasury said.

Tax increases of R5 billion in the next fiscal year and R10 billion and R15 billion in the outer two years will also be implemented - these additional tax measures will be announced in February.

“These measures require difficult choices that will affect the distribution of public resources,” the presentation read.

Further details will be revealed in the medium-term budget policy statement.

Treasury said research and analysis is being conducted on wealth taxes, and improvement in collections by SARS will also assist efforts to raise revenue. – FIN24.

Boeing’s 737 Max was grounded in March 2019 following an Ethiopian Airlines crash

Europe to start Boeing 737 Max test flights

LONDON - EU aviation regulators have scheduled flight tests for Boeing’s troubled 737 Max plane.

The European Union Aviation Safety Agency (EASA) said the tests would take place in Vancouver, Canada in the week beginning September 7.

Boeing’s best-selling aircraft was grounded last year after two crashes killed all 346 people on the flights.

The announcement comes two months after US regulators began similar test flights for the jet.

However, EASA has maintained that clearance by the US Federal Aviation Administration will not automatically mean a clearance to fly in Europe.

The agency said it had been “working steadily, in close co-operation with the FAA and Boeing, to return the Boeing 737 Max aircraft to service as soon as possible, but only once it is convinced it is safe.”

It said the process of scheduling the test flights had been hindered by Covid-19 travel restrictions between Europe and the US It added: “While Boeing still has some final actions to close off, EASA judges the overall maturity of the re-design process is now sufficient to proceed to flight tests. These are a prerequisite for the European agency to approve the aircraft’s new design.”

EASA said simulator tests would take place from 1 September at London’s Gatwick airport.

Meanwhile, the FAA has put forward a wide-ranging list of changes it wants to be made before the planes can fly again commercially.

These include updating flight control software, revising crew procedures and rerouting internal wiring.

Boeing hopes to get the 737 Max back in the air early next year.

Aviation regulators grounded the 737 Max following two crashes - a Lion Air flight and an Ethiopian Airlines flight - within five months of each other. – BBC.