FINANCE, Economic Development and Investment Promotion permanent secretary George Guvamatanga has revealed that government has received a plethora of demands from prospective investors for Zimbabwe to be considered a favourable investment destination.
The demands include an exemption of their workers from paying taxes, he said.
Speaking at the Zimbabwe Investment and Development Agency (Zida) Northern Region capacity building workshop in Harare last week, Guvamatanga said there were projects deemed viable only because “the government gets over piles and piles of fiscal incentives”.
He said there were projects where investors didn’t want their employees to pay taxes.
“They will even want to bring in from their desks, pens, rulers, everything duty free,” Guvamatanga said, adding that some of the projects have a shorter shelf life which means the country will not get anything after giving incentives.
The demands come as the country is desperate for foreign direct investments (FDI), years after investors gave Zimbabwe a wide berth due to policy inconsistencies and a deteriorating economic environment.
President Emmerson Mnangagwa has been on a crusade to lure FDI under the “Zimbabwe is open for business” slogan.
Statistics show increased interest from investors with data showing that Zida issued 154 licences during the second quarter of 2024, for a value of US$1,8 billion. This was up from the US$622,18 million worth of licences issued in the first quarter, which totalled 143 licences.
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Guvamatanga’s revelations call for a need to balance the interests of the prospective investors and those of a country.
It becomes pointless if the so-called investors demand a host of incentives at the expense of the country resulting in it getting the short end of the stick.
There are reports of some investors who, after getting incentives, evade formal banking channels amid allegations they ship the money to their countries of origin.
They sell strictly in cash and do not use fiscalised cash registers which means that the country lose out in value added tax and intermediated money transfer tax.
However, these so-called investors appear to be riding on the coattails of senior politicians who give them carte blanche.
We cannot sell off family silver because politician X or Y has been bribed or will benefit from such a skewed deal.
We urge authorities dealing with prospective investors to be firm so that the country gets the real investors it deserves.
The era of briefcase businesses masquerading as investors is long gone.
The country needs real investors to propel the Vision 2030 agenda of attaining an upper-middle-income status.
That dream can only be realised if the country gets investors that are interested in developing the economy by boosting production thereby creating jobs and contributing to the fiscus through payment of taxes.
Zida must have the guts to turn down dubious investors, notwithstanding their country of origin.
Zimbabwe’s interests must come first. The country has regressed and needs to play catch-up with regional peers.
A revamp of the tax incentive system is key to unlock more tax revenue instead of burdening overtaxed individuals and companies.
