Zambia to Waive Tax Revenues for 3 Months to Cushion Impact from Middle East Conflict
ZAMBIA – Zambia will waive tax revenues for a period of 3 months, totaling around $200 million, in what the Finance Minister Situmbeko Musokotwane said on Tuesday was to cushion impact from Middle East conflict.
Musokotwane said this would be done by suspending the excise duty and zero-rated value added tax (VAT) on petroleum products for a three-month period from April 1 to June 30.
He said this while sharing Zambia’s experiences in addressing the emerging war-induced global economic crisis at ongoing spring meetings of the IMF and the World Bank in Washington, DC.
Musokotwane called for broader and more strategic fiscal policy across Africa, urging the continent to move beyond managing recurring shocks by using public policy more deliberately to raise productivity, strengthen energy security and transform the structure of its economies.
“Economies that produce more, diversify more and trade more competitively are better placed to absorb shocks without slipping into repeated crises,” he said.
Noting that the immediate risk facing many African economies over the next 12 months is a possible energy crisis arising from the Gulf region conflict, he said such a development could intensify inflationary pressures, raise production costs and further constrain fiscal positions.
“While support from institutions such as the IMF would be welcome where necessary, African governments must also continue undertaking domestic reforms that improve resilience and strengthen the quality of public spending,” he added.
