As the nation is fighting hard to come out of its economic doldrums, many of the citizens are solely depending on self-employment as a means to make ends meet.Formal employment rate is dwindling day by day as a result of industrial closure, and the tax man is knocking every door possible.
Indigenization has become a national agenda just like our beloved national anthem to accommodate self-employed citizens. Laws have been enacted by the government to try to formalize indigenous businesses scattered all over the country .
But the biggest question is, are we really benefiting through these policies? Who are the beneficiaries of these policies?
By Tongai Mwenje
Rumor mill is grinding that the ministry of local government, public works and national housing is planning to tax all vendors across the country. The tax is targeting every street vendor in a bid to formalize their operations. Taxes will vary from one vendor to another depending on the type of business they are into.
An inside source with the Harare City Council said, ‘The government has realised that all unregistered street vendors must contribute to the fiscas through taxation, very soon all these vendors will be paying taxes daily and the amount will vary according to the nature of their businesses.’
Airtime vendors will be susceptible to a $1 per day for them to operate without fear from council officials. At the moment vendors are operating at their own risk as most of them risk losing their goods to the council as their operation is said to be illegal.
Council officers are all over the place hunting for illegal operators and traffic law abusers especially by kombi operators, anyone caught outside the law will be liable to a fine or imprisonment or both depending on the magnitude of their cases.
Airtime vendors pay a fine of $5 and their goods are confiscated, thus losing their hard earned cash and their income generating goods.
Taxes will make their life easier and will make them independent in their operations. After the news came into my ears I had to carry out some interviews, the news was received with mixed feelings; some were for the idea while others were vehemently against it as they claim that it will eat into their small profits.
They buy airtime at a wholesale price of $0.98 and will sell the recharge cards for $0.02 profit, meaning 50 recharge cards worth $1 each are enough to raise their daily taxes. This means they have to attract 50 clients per day to be able to recharge their daily lease business life. We haven’t looked at their daily needs, lunch or bread to fend their families.
Some are even struggling to attract 20 clients if not less per day, so where and how will they get the money to pay for the taxes. Let’s not forget the cash crunch environment we are living in, people are not spending much on airtime especially with the emergence of cheap network platforms such as Whatsapp, Viber its difficult to see people spending much on airtime.
Mobile Network Providers have introduced Whatsapp bundles where $1 can push you as far as one week meaning the airtime budget has been reduced to a dollar per week. So with this how are they going to raise that money for their daily taxes? Is it not going to defeat the whole purposes of indigenisation?
Some airtime vendors welcomed the initiative as they said it will make their business grow since they had been suffering from losing their products to the council officials.
‘We welcome that move because it will enable us to work freely without losing our airtime to the council.’ ‘To be honest with you we are not at ease right now even when you came here we thought you were one of city council officers and we wanted to run away as that has become synonymous of us illegal vendors.’
Is this a noble idea considering our current economic situation? Isn’t this a mountain to climb for this low profit margin business? Let’s wait and see how this going to fare in our current economic hardship.