Mthuli Ncube warns of more pain ahead

Finance minister Mthuli Ncube has warned Zimbabweans to brace for more pain as he tries to pull the country's tottering economy out of its current state.

The well-regarded former banker has also said there is no going back on the controversial two cents per dollar transactional tax which has left a wide cross- section of Zimbabweans apoplectic with rage following its effect on the economy.

Addressing a media briefing where he unveiled his Transitional Stabilisation Programme (TSP), Ncube said things were going to be painful before they got better.

"We need to stop the bleeding and this is one way to do it; we can't do this without pain. At the end we will be glad, we need to fix our problem together; I need all hands on the deck.

"I will be honest; there will be a little pain as we try to redress the economy. People don't realise that already they have been paying indirectly for the sickly economy.

"The previous tax has been regressive, people were paying very little. We do, however, have leeway in future to fine-tune the taxes," Ncube told journalists.

The founder of the now defunct Barbican Bank said the two cents per dollar tax was "nothing" compared to what other countries were paying, adding that the collected proceeds would benefit the social services sector.

"There is a country in Africa; I won't name it, which is charging 15 percent for electronic transactions. It is a norm across Africa. Government will do its part in controlling expenditure; we will be accountable for the taxes you are paying.

"Soon we shall come back and tell you how many hospital beds we have bought, how many roads we have fixed," Ncube said.

"The new tax will be mainly set aside for the social services sector, and focus will be on the marginalised areas; to ensure that they have access to health and education.

"We have made a commitment, you will not see this money going into travel expenses or purchasing of motor vehicles. If it means we will scale down on the vehicles that we buy as government then we will do that. We will even buy locally," he added.

Ncube said contrary to the criticism that he didn't consult when he announced his measures this week, he had consulted widely before unveiling them.

"Oh, I did make consultations … people should not focus on whether I made consultations or not, but rather what we want to do," he said.

On Monday, Ncube announced a slew of measures in the Fiscal statement as President Emmerson Mnangagwa's government put in motion plan to reverse the current economic slide.

"I hereby review the Intermediated Money Transfer Tax from 5 cents per transaction to 2 cents per dollar transacted, effective October 1, 2018.

"I am therefore directing financial institutions, banks and Zimra, working together with telecommunication companies to extend the collection to all electronic transactions," Ncube announced on Monday.

But the government's new measures to stabilise the country's sickly economy have been rejected by a wide cross section of the Zimbabwean populace - who feel that the steps taken by authorities will worsen their suffering.

Already militant labour unions have warned they are preparing to go on strike - to protest the two cents per dollar tax - and which they say must be reviewed by the government as a matter of urgency.