200 million USD lost in tax suspension

Minister of Finance and National Planning Situmbeko Musokotwane says the three-month suspension of taxes to cushion the rising cost of fuel as a result of the war in the Middle East will result in a 200 million U. S Dollar loss of revenue for the treasury. Dr Musokotwane says government is therefore working on various measures to help mitigate this impact such as the introduction of a supplementary budget to fund the fuel subsidies, among other costs The Minister said this during the First Quarter Development Coordinating Committee meeting in Lusaka.

“This is why as we come to the close of Parliament, we are also taking into account the loss of revenue because of the suspension of the relevant taxes”, Dr Musokotwane explained. Speaking at the same event, Acting Permanent Secretary for Economic Management and Finance, Akapelwa Imwiko said the Kwacha has recorded significant gains of up to 13.1 percent, against the U. He stated that this is despite the heightened risk arising from the conflict in the Middle East that has had a negative impact on economies around the world.

Mr Imwiko has attributed the gains to various reforms by government that have strengthened fiscal stability, improved investor confidence and supported growth in different sectors such as mining. He has disclosed that supply of foreign exchange in the mining sector increased by over 700 million U.S Dollars. “Government has stabilised the economy through strong macroeconomic management and is now focused on consolidating these gains to support higher, inclusive and job-rich growth.

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He has, however, noted that the escalation in the Middle East tension threatens the gains scored by government. And Zambia Institute for Policy Analysis and Research (ZIPAR) Interim Executive Director, Zali Chikuba has warned that Zambia’s 2026 developmental targets are threatened by the Middle Eastern war-related pressure. He has since recommended measures such as protection of vulnerable households, ensuring trade corridors are kept functional and the building of long-term energy resilience.

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