Zvamaida Murwira
Senior Reporter
PRESIDENT Mnangagwa has signed into law the Finance Act and Appropriation Act that gives legal effect to the 2026 National Budget that was recently passed by Parliament.
Treasury, through Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube can legally disburse funds appropriated under the budget.
The signing of the two laws by President Mnangagwa was announced by Chief Secretary in the Office of the President and Cabinet Dr Martin Rushwaya in an Extraordinary Government Gazette published yesterday.
“The following laws, which were assented to by His Excellency, the President are published in terms of Section 131 (6)(a) of the Constitution of Zimbabwe, Finance Act and Appropriation Act,” reads the notice.
The Finance Act gives legal effect to the fiscal policy measures announced in the Budget, while the Appropriation Act authorises expenditure votes for ministries and Government departments.
During debate Treasury made several concessions on key fiscal measures, paving the way for the implementation of Government’s spending and revenue plans for the coming year.
The budget was approved after both the Finance Amendment Bill and the Appropriation Bill were read for the third time in the National Assembly and the Senate, signalling their passage.
Prof Ncube presented the budget last month, outlining a mix of revenue enhancing and expenditure measures aimed at stabilising the economy and supporting growth.
Debate was protracted, with legislators raising concerns and proposing amendments, some of which prompted concessions from Treasury.
Dzivaresekwa legislator Mr Edwin Mushoriwa and his Kuwadzana counterpart, Mr Chalton Hwende, were among backbenchers who tabled proposed amendments to the Finance Act, although the proposals were rejected after debate.
One of Mr Mushoriwa’s proposals sought to ring-fence revenue from the sugar tax exclusively for the health sector, as originally envisaged when the levy was introduced.
Prof Ncube opposed the amendment, arguing that there had been no diversion of the funds to other uses and that additional legal safeguards were therefore, unnecessary.
During the debate, the Finance Minister agreed to adjust allocations for several institutions, including Parliament, whose vote he said would be increased by an additional ZiG800 million, from ZiG3 billion. He also reversed his proposal to double the gold royalty rate to 10 percent after legislators warned that the increase would negatively affect miners and the broader industry.
The royalty rate will now remain at 5 percent for gold prices ranging between US$1 200 and US$5 000.
Prof Ncube further withdrew his proposal to introduce a cash withdrawal levy following concerns that the measure would overburden formally employed citizens and undermine efforts to formalise the economy.
He acknowledged calls from lawmakers to review foreign currency withdrawal charges and to protect diaspora remittances and small to medium enterprises by suspending the levy below a substantial threshold.
“My other proposal would be to review the foreign currency withdrawal levy . . . and to suspend its application on withdrawals below a substantial threshold to protect diaspora remittances and SME cash flows.
“I also want to recommend that we amend the presumptive tax framework and index the threshold to inflation, raising it from ZiG5 000 to at least ZiG10 000 monthly return,” said Prof Ncube.
Addressing criticism over the decision to increase Value Added Tax (VAT) by 0,5 percentage points from 15 percent, Prof Ncube said the measure would not harm low-income earners, as most basic commodities consumed by poorer households are zero-rated or exempt from VAT.
He cited items such as bread, cooking oil, salt, milk, sugar, vegetables, fruits, maize meal, wheat flour, sanitary products and agricultural inputs among goods that do not attract VAT.
Prof Ncube also defended the increase by comparing Zimbabwe’s VAT rate with those of other countries in the region, noting that several peers have higher rates.
The 2026 National Budget projects total expenditure of ZiG290 billion, equivalent to about US$9,5 billion or 17 percent of gross domestic product (GDP).
This is set against a revenue target of ZiG288 billion, or about US$9,4 billion, representing 16,9 percent of GDP.
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