Icaz hails Murerwa’s plans on economy

THE Institute of Chartered Accountants of Zimbabwe (Icaz) has commended Finance minister Herbert Murerwa for making clear in his budget statement his determination to curb inflation and revitalise the economy.



NT face=”Verdana, Arial, Helvetica, sans-serif”>However, it regretted that few substantive measures to achieve this had been announced. Icaz said to a considerable extent the impact of the budget would be determined by new monetary policies to be announced by the new Reserve Bank governor, Dr Gideon Gono next month.


Icaz said it also welcomed taxation measures announced by the minister to take care of the hyperinflation environment but urged that these be periodically reviewed to take care of new inflation levels.


“The institute commends the minister for his declared intent to contain inflation and to revitalise the economy through export and productivity incentives, vigorous implementation of fiscal discipline, adherence to budgets, constrained borrowings and curbing corruption,” said Icaz.


“However, it is regretted that few substantive measures to achieve these ends were announced, leaving a sense of his economic policy projection being a wish-list unsupported by proposals for fulfilment.


“The institute is pleased to note that, in respect of taxation measures, the minister has given significant recognition to the hyperinflationary environment by substantially increasing the tax threshold for individuals, widening tax bands, enhancing capital gains tax allowances and providing for higher death duty rebates.”


Icaz added: “It is feared however, that the efficacy of the increases will be rapidly eroded by continuing inflation. The institute urges therefore, that the minister effects periodic reviews concomitant with such inflation.”


The institute however noted that the economic impact of the budget will be determined by the effectiveness of new monetary policies to be announced.


Further evaluation of the budget will however have to await the monetary policy statement with special regard to reduction of inflation and pursuit of growth of Gross Domestic Product, Icaz said.