Breaking News

Finance Minister cannot change Act Of Parlimanet via ministerial statement

by Sithabile Mafu
05 October 2018 | 5396 Views
Parliamentary, legal and civil rights watchdog, Veritas, has said that the 2 percent tax on money transfers which was announced by Finance Minister Mthuli Ncube on Monday is legally unenforceable as the law is still unchanged. Veritas goes on to warn ZIMRA, financial institutions, banks and telecommunications companies not to implement the new tax until the measures are confirmed by an Act of Parliament. Writes Veritas,

NEW TAX NOT LEGALLY IN FORCE

What Minister Ncube said on 1st October

In his statement Fiscal Measures for Reversing Fiscal Dis-equilibrium delivered on 1st October the Minister of Finance and Economic Development said:

"I hereby review the Intermediated Money Transfer Tax from 5 cents per transaction to 2 cents per dollar transacted, effective 1 October 2018.  I am therefore directing financial institutions, banks and ZIMRA, working together with telecommunication companies to extend the collection to all electronic transactions."


But Law Still Unchanged

As at the time of writing [2.30 pm, 4th October] the law remains unchanged.  It is still as it was before the Minister's statement: the rate of the Intermediated Money Transfer Tax is "US$ 0.05 for each transaction exceeding US$ 10,00 on which the tax is payable" as provided by Parliament in section 22B of the Finance Act [Chapter 23:04].

What the Minister Should Have Done

The Zimbabwean legal system does not allow a Minister to change any law, let alone an Act of Parliament, by a Ministerial statement.

The Minister's should have been advised to gazette regulations changing the rate of the tax on the same day as his statement, the 1st October.

He the power to make such regulations under section 3(2) of the Finance Act.




If the Government wishes to persist with the new tax rate despite the adverse reaction in several sectors, the Minister can  still make regulations now.  Regulations made under section 3(2) of the Finance Act, however, must, as required by section 3(3), be promptly confirmed by Act of Parliament:  Section 3(3) states:

"If any provision contained in regulations referred to in subsection (2) is not confirmed by a Bill which  –

(a) passes its second reading stage in Parliament on one of the twenty eight days on which Parliament sits next after the coming into operation of the instrument: and

(b) becomes law not later than six months after the date of such second reading;

that provision shall become void as from the date specified in the instrument as that on which the rate of tax duty, levy or other charge shall be amended or replaced, and so much of the rate of tax, duty, levy or other charge as was amended or replaced, as the case may be, by that provision shall be deemed not to have been so amended or replaced."


This means that if the time limits for confirmation are not complied with, any changes they may have made will fall away as if never made at all [same Act, section 3(3)] [i.e. taxes, etc collected might have to be refunded].

Implementation of the New Tax Must be Delayed

If they have already implemented or continue to implement the Minister's legally ineffective review/directive, ZIMRA, financial institutions, banks and telecommunications companies will have done so at their peril.  And they should bear in mind that if and when the Minister makes appropriate regulations, any attempt to backdate the new rate of tax to 1st October is likely to face a stiff constitutional challenge.  Unlike the former Constitution, the present Constitution specifically commands "respect for vested rights" [section 3(2)(k)].  [Note: "vested rights"  are those that already exist which cannot be impaired or taken away (as through retroactive legislation).]

Mthuli Ncube Finance Minister Act Of Parlimanet ministerial statement Veritas

Source: Byo24News

Comments

Latest News

Chamisa's NEC upholds Bulawayo appeals

by Ndou Paul | 22 May 2019 | 1 Views

Bosso captains allay relegation fears

by Staff reporter | 21 May 2019 | 9 Views

West urged to support Mnangagwa

by Staff reporter | 21 May 2019 | 28 Views

Joint executorship for Mtukudzi's estate

by Staff reporter | 21 May 2019 | 53 Views

RBZ to continue with confidence building measures

by Staff reporter | 21 May 2019 | 324 Views

Police station 'under siege' from angry Yeoville residents - The killi...

by Citizen reporter | 21 May 2019 | 2303 Views

WATCH: 'Zimbabwean' actor in Game Of Thrones

by Staff reporter | 21 May 2019 | 1967 Views

Trevor Ncube blames Zimbabweans for fuel price increase

by Mandla Ndlovu | 21 May 2019 | 4788 Views

Chiwenga rushed to India for medical treatment again

by Mandla Ndlovu | 21 May 2019 | 8281 Views

WATCH: Small house viciously beaten and hair cut by main wife - A sens...

by Mandla Ndlovu | 21 May 2019 | 2949 Views

1 VP for Chamisa's govt

by Staff reporter | 21 May 2019 | 2481 Views

After denials, ZERA hikes fuel price - The Zimbabwe Energy Regulatory...

by Staff reporter | 21 May 2019 | 1460 Views

Seven things to consider when transacting in Africa

by Morne van der Merwe, Managing Partner, and Wildu du Plessis, Head of Africa at global law firm Baker McKenzie in Johannesburg | 21 May 2019 | 407 Views

Mphoko's nemesis suspended by Choppies Board - The board of grocery re...

by Staff reporter | 21 May 2019 | 1444 Views

Acie Lumumba warns Mnangagwa

by Mandla Ndlovu | 21 May 2019 | 19911 Views

'Fuel prices to cause civil unrest'

by Mandla Ndlovu | 21 May 2019 | 4268 Views

Arrest of regime change suspects condemned

by Heal Zimbabwe | 21 May 2019 | 1871 Views

WATCH: Chamisa dances to Malema's song

by Mandla Ndlovu | 21 May 2019 | 7256 Views

Entertainment

Muridzo rubbishes critics

by Simbarashe Sithole | 20 May 2019 | 1014 Views

Nigerian to play Mugabe role in forthcoming movie

by Staff reporter | 18 May 2019 | 2409 Views

Malunga quits sex

by Staff reporter | 15 May 2019 | 7107 Views

I didn't ride on Tuku's fame, says Selmor

by Staff reporter | 14 May 2019 | 2131 Views

Tsholotsho girl shines in SA - DYNAMITE comes in small packages is the...

by Staff reporter | 13 May 2019 | 2426 Views

Jah Prayzah ditches anything associated with Mnangagwa's army

by Staff reporter | 12 May 2019 | 4299 Views

The rising popularity of Maskandi artists in Bulawayo

by Staff reporter | 12 May 2019 | 1998 Views

WATCH: Oliver Mtukudzi's widow singing Paunapopo

by Mandla Ndlovu | 01 May 2019 | 23103 Views