Zim unveils measures to boost formal business environment

Cabinet has approved various measures aimed at tackling challenges in the formal business environment and supporting micro, small, and medium enterprises (MSMEs), Information, Publicity and Broadcasting Services Minister, Dr Jenfan Muswere, said after yesterday’s Cabinet meeting.

The Cabinet aims to bring all businesses into the tax bracket and enhance the effectiveness of the foreign exchange market to strengthen the economy.

Dr Muswere said the measures encompass immediate actions and long-term strategies designed to streamline operations and improve the business climate.

“The Government seeks to bring all businesses into the tax bracket and enhance the effectiveness of the foreign exchange market.

“In the long-term, Government will address the business environment in order to streamline fees, charges and minimise duplication of work by Government agencies as well as improve electricity supply. Such an environment will enable MSMEs to graduate into formal businesses,” said Dr Muswere.

All businesses will be required to use electronic money, supported by a new compulsory tax payment system to ensure compliance among taxpayers.

A team will be established to ensure tax compliance within the informal sector, with vendor licensing requiring consultation with the central Government.

Vendors will be required to obtain Point-of-Sale (POS) machines and open bank accounts upon registration and licensing. Enhancements to the foreign exchange system will reduce the foreign currency retention level for exporters from 75 percent to 70 percent and lower bank charges.

Medium-term measures will focus on lowering the cost of doing business by reducing fees and minimising duplication of work by government agencies.

Dr Muswere said strict adherence to the Indigenisation and Empowerment Act will be enforced, promoting local procurement to support the local industry.

Government plans to expedite the construction of power plants and upgrade distribution networks to enhance electricity availability.

Measures will include establishing designated workspaces, creating a favourable regulatory environment, and simplifying taxes and rates.

Dr Muswere emphasised that the measures are part of a broader vision to create a robust and resilient economy that supports all sectors, particularly MSMEs, which are vital for job creation and economic growth.

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