Parly committee proposes sin tax to fund health sector

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HARARE,– The Parliamentary Portfolio Committee on Health and Child Care has proposed that Finance Minister Patrick Chinamasa introduces sin tax on sugary foodstuffs and drinks to raise funds for the health sector.

The Ministry of Health was allocated $408 million in the 2018 budget, about 5,8 percent of the national budget but is deemed not enough to address the myriad of challenges facing the sector.

“We propose that a sin tax should be introduced on sugary foodstuffs and drinks to fund treatment of non-communicable diseases,” Binga North MP Prince Dubeko Sibanda said on Tuesday while presenting the committee’s report on 2018 budget.

“We believe sugar is a serious contributor towards towards non-communicable diseases, and to fund our health sector we should introduce a levy on all sugary foodstuffs and drinks.” Bulawayo South MP Eddie Cross suggested that all electronic transactions, including swiping when one is buying goods must attract a five cents tax.

Government already taxes such transactions $0,05.

Cross said bankers and tax experts estimate that the total value of swipe transactions in 2017 was $75 billion, and $50 billion in RTGS transactions.

“We are looking at $180 billion electronic transactions in 2018 and to me it actually reflects that our economy is of a bigger size than the $19 billion gross domestic product figure reflected by Chinamasa. This is not a poor country,” said Cross.

“Our real GDP is $40 billion, and I believe we can provide money for the health sector if we put a small tax of 5 cents on all swipe electronic transactions. We can raise $9 billion of new revenue. If you swipe you pay five cents to the Minister of Finance and it will solve our problems and reduce expenditure to 35 percent of our budget, and ensure we settle our bills to multinational agencies.”