Thursday, March 27, 2014

Removal of windfall tax was painful to Zambians - Mulongoti
By Kombe Mataka
Tue 17 Dec. 2013, 14:01 CAT

MIKE Mulongoti yesterday said that the decision by the Rupiah Banda regime to remove the windfall tax was painful to Zambians who had given them the mandate to rule. And Mulongoti has cautioned the PF to seriously reflect on the need for unity in the country as the year comes to an end.

Reviewing the PF's performance this year in an interview, Mulongoti, who is People's Party president and former works and supply minister, said the PF must seriously review the tax regime of the country.

"The truth of the matter on the windfall tax is there are some of our colleagues who were so determined to ensure that the windfall tax remained. It is not everybody in Cabinet (Rupiah Banda's) who supported it," Mulongoti said.

Mulongoti said he was aware that Banda had referred to him during a workshop held recently by FODEP when he spoke about the issue of the windfall tax but that he failed to mention that it was a very painful decision for many Zambians.

"Mind you, there is what we call collective responsibility; it was so embarrassing that we said, 'what are we going to tell the people because we were there and called to lead'. I can tell you it was a very painful decision. Not everyone in Cabinet supported it, but you see, we were overwhelmed by some of our colleagues who pushed that agenda for whatever reason, very vigorously. The minutes are there in Cabinet, it is not something new which has come up. We supported it fully when it was introduced and we were not convinced why it was removed."

Mulongoti said there was no moral justification for the government not to re-introduce the windfall tax.

"The benefits that came from the U$S480 million which government accrued from the introduction of windfall tax, surely who would not be happy with such money coming in the treasury?" Mulongoti wondered.

"Was there any reason to lose that money? Go to the Congo DR, they are getting maximum benefits from their minerals. Go to Zimbabwe, President Robert Mugabe says shareholding must be 50 per cent to indigenous people. It is a lie that investors will go away. Let me tell you, investors will not go away."

Several quarters of the Zambian society have called for the re-introduction of the windfall tax but the government has indicated it will not consider that option.

And Mulongoti said the PF should focus on working in unity in order to consolidate political gains next year as opposed to engaging in squabbles.

"They have spent more time trying to accept that they are in government and then there was a development which was very sad, that within themselves, they started positioning themselves for the future as opposed to consolidating their gains," he said.

"Now the future cannot be assured if the current situation is failing. You can assure yourself of the future but if your performance is bad, no matter how much you plan for the future, you will short-change yourselves. PF needs to concentrate as a team to build their performance, to remain a united force and not to take away from each other or subtracting from each other's integrity."

Mulongoti observed that there was too much focus on the top position of the party by many senior members as opposed to making the party much stronger on the ground.

"Everyone seems to be eyeing the top and the top is not within sight. The people of Zambia gave them the mandate and that mandate came with a lot of expectations."

And Mulongoti said the removal of subsidies on maize and fuel was a hard decision.

"What has happened is the PF has made some decisions that are very hard, like removal of subsidies, which I feel they must reconsider because it is going to cost them. The price of staple food is going up, fuel prices have gone up and people are very unhappy about that. World-over, governments try to cushion the impact on food and at some time fuel," Mulongoti said.

"Secondly, they seem to be underestimating the anger of the people over this Constitution."

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