THE Zimbabwe Congress of Trade Unions (ZCTU) has slammed a proposal by the cash-strapped government to tax informal traders at a time when the players in the sector are struggling to make ends meet.
Zimbabwe Revenue Authority (Zimra) commissioner general, Gershom Pasi said recently that they intended to increase their tax base through capturing revenue from the informal sector.
ZCTU president, George Nkiwane however said the plan to tax the already suffering informal sector showed that the government had become desperate.
Currently, unemployment rate in Zimbabwe reportedly tops 80%.
"We heard that Zimra wants to collect tax from the informal sector. How are you going to collect tax from a vendor when the municipal police are also chasing them away from their market points?" Nkiwane said in a speech read on his behalf by the Zimbabwe Banks and Allied Workers Union secretary general, Gift Mutasa on Workers' Day in Bulawayo.
Nkiwane questioned how Zimra would collect tax from airtime vendors when government had not given them a place to operate from.
"Currently, they are operating in the middle of the road facing different hazards. The basic economic principle is that they should collect tax based on equity principle," said the ZCTU official.
Nkiwane said most of the informal traders were not making profit and would not be able to pay tax.
"The government must collect tax on the benefit principle and you cannot collect taxes from the poor so that they can feed the rich in Borrowdale," he said.
He said the intended introduction of taxes was set to destroy the few jobs in the informal sector.
"If you are going to just collect taxes without building stalls, who is going to benefit? I think Zimra is out of order. We need to save our colleagues who are in the informal sector. They did not choose to be there. They were forced by the policies of the ruling government since 1980. The government claims that it's pro-poor and pro-workers," said Nkiwane.
He said the Zanu PF government had said it would create two million jobs but nothing had happened.
"Instead of protecting the few jobs that are there, it appears its now on the forefront of destroying those jobs," said Nkiwane.
It is estimated that more than US$7 billion is circulating in the informal sector which is not contributing to the national fiscus.