A number of important analytical pieces have been written on the Budget 2008 that may have escaped your radar.
PWC Zambia recently published their Beyond Figures : 2008 Budgetary Changes. A great read if you want to quickly get a handle on the changes and what they mean for the economy going forward.
The JCTR have produced an interesting piece - Analytical Paper on the 2008 NATIONAL BUDGET.
Neo Simuntanyi has written a fascinating piece in the Post, on
2008 Budget - Scratching the Surface, which raises some important questions on whether the budget succeeds in "unlocking resources for economic empowernment and wealth creation"Agriculture is critical to increasing economic growth and fighting rural poverty. Following the The 2008 Agriculture Budget presentation, a number of pieces have appeared in the press on this. The Daily Mail have a piece called Budgetary funding to agriculture reduces . The Post Business also run some interesting pieces on this, which I have uploaded here.
THE 2008 NATIONAL BUDGET
ReplyDeleteThe reduction of value added tax (VAT) from 17.5% to 16%, revisions in Pay-As-You-Earn (PAYE) regime, and other minor policy changes will not result in meaningful economic growth, job creation and poverty reduction. Deeper cuts in taxes that would have truly matched the 2008 budget theme of "Unlocking Resources for Economic Empowerment and Wealth Creation" would have made it possible for citizens and business entities to keep more of their hard-earned incomes for investment, savings and consumption.
In this direction, reductions in VAT, PAYE and corporate taxes of at least 5 percentage points would have greatly stimulated the national economy. We need to avoid the pursuit of single-digit inflation at the expense of job creation, poverty reduction and sustained economic growth.
The Republican president would have also played an important role by trimming the highly bloated state apparatus. A reduction in the number of Cabinet portfolios, abolition of the positions of District Commissioner and Deputy Minister, a reduction in the number of Zambia’s foreign missions by having missions that cater for groups of countries, and other cost-cutting measures would have saved financial and material resources for investment in education, healthcare, food security, infrastructure, and crime-fighting, among other things.
It is inexcusable to continue to maintain sinecures at public expense while the country drifts farther into socio-economic decay and backwardness. We need to put an end to political appointments designed to reward party cadres for their duties during elections. It is high time we became serious about how we apply our beloved country’s meager national resources for the common good of all Zambians!
There is a pressing need for policy measures and initiatives designed to uplift the common people from squalor and abject poverty.
The move of increasing mining and coperate tax is long over due. However, Mwanawasa has moved yet again at a wrong time. The increase in corperate tax will harm investment because this is a point in time when will are likely to see a slow global economy as a result of a recession in the US as well as slowing economy in Britain. I think coperate tax should be revised but we need to to do it at a time when all the indicators are showing a positive gain for the country.
ReplyDeleteI totaly agree with you on fiscal responsibility and reduction of our govt. There is a lot of unneccessary portifolios in government which we can do well without. If govt will go on funding non functionl organs or xeroxed organs we will not see meaningful economic gains. Worse more government has been turned in an arena to strengthen parties as oppossed to bringing the people at the bottom out of poverty.
When all is said and done, there will be great need to revise our trade policies and put in place policies which will benefit Zambia.
There's no time to sit and dream then wake up one day and guess increasing corperate tax would benefit Zambia yet we stand to loose.
Kyambalsesa,
ReplyDeleteThe Republican president would have also played an important role by trimming the highly bloated state apparatus. A reduction in the number of Cabinet portfolios, abolition of the positions of District Commissioner and Deputy Minister, a reduction in the number of Zambia’s foreign missions by having missions that cater for groups of countries, and other cost-cutting measures would have saved financial and material resources for investment in education, healthcare, food security, infrastructure, and crime-fighting, among other things.
On the one hand, they don't believe in central planning (or any planning), as good neoliberals. On the other hand, they won't reduce the massive number of ministries.
Also, there seems to be no demand for results, wether it is from the National Development Plan, or the completion of projects, like in road construction.
I don't know how much of that is caused by the new ideology of neoliberalism (see the mess made by the neoliberals in Washingtin DC or and in Iraq); an unwillingness to take responsibility so as not to be seen to fail (basically seeing failure as an assault on the government's authority); or whether the elected government is held back by their civil servants, the permanent secretaries.
Anonymous,
The increase in corperate tax will harm investment because this is a point in time when will are likely to see a slow global economy as a result of a recession in the US as well as slowing economy in Britain.
The only thing that really matters to investments in the copper industry, is the price of copper, not whether corporate taxes increased from 25% to 30%. And where copper is available - Zambia.
Companies aren't parsing how much tax they have to pay.