HH advises government to stick to VAT – Zambian Watchdog

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There are those of us who believe in the efficacy of Value Added Tax (VAT) as a fairer consumption tax for logical and technical reasons. When correctly implemented, VAT is likely to have a higher positive impact on the economy and society as a whole.

In particular, the benefit of VAT lies, among others, in its ability to promote savings, capital formation and investment which is essential for economic development, jobs creation, business opportunities, social uplift and poverty reduction.

VAT is a tax whose possible negative effect on low income earners can be mitigated through appropriate tax credits/allowances.

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VAT is a tax which is relatively cheaper and easier to collect than some other taxes such as the PF proposed General Sales Tax (GST) .

We advise that PF should drop/not implement their unwise and inappropriate idea of replacing VAT with GST.

As we have argued before, GST is penal, more costly and difficult to collect. Overall, the GST introduction is likely to result in the Treasury collecting less tax revenue to support health, education, food security and other social services.

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GST will therefore hurt households, the general citizenry, savings, businesses ( small/medium/large companies which will lead to further business closures and consequently more job losses). Without doubt, GST will slow down even further the already declining economic growth.

PF’s poor leadership has already caused so much damage to our country and people’s lives.

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As such and for once, PF should listen to our sound advice for the good of our economy and people.

*Hakainde Hichilema*
*UPND President*

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