Zambians being overtaxed – JCTR

…as cost of living skyrockets to 12, 253 per month, as Fr Daniel Mutale says Government should have considered introducing windfall tax on high copper profits in the 2027 budget instead of burdening those whose economic hardships are excruciating
By BARNABAS ZULU
GOVERNMENT should have introduced windfall tax on high copper profits from the mining sector instead of overtaxing citizens and deepening their economic hardships by placing heavier tax burden on them, the Jesuit Centre for Theological Reflections (JCTR) has said.
And the cost of living for a family of five in Lusaka has increased by K854.08 in October, with the Jesuit Centre for Theological Reflection (JCTR) warning that rising food prices are putting further pressure on households.
Speaking at a press briefing yesterday, JCTR executive director Father Dr Daniel Mutale said the heavy tax burden was particularly high among people in formal and semi-formal employment because they were easily identifiable through various government databases.
Fr Dr Mutale said workers registered with institutions such as the National Pension Scheme Authority (NAPSA), Zambia Revenue Authority (ZRA) and National Health Insurance Management Authority (NHIMA) were easily targeted for taxation.
“The tax burden for those that are taxed in Zambia is indeed high. It is very high. The trouble is that the group that is taxed very easily is that group which is in formal or semi-formal employment,” Fr Dr Mutale said.
Fr Dr Mutale said the burden went beyond Value Added Tax (VAT), as citizens also faced various levies and transport-related charges that reduced their disposable income.
He said Government should be more deliberate in identifying those in the informal sector with the capacity to pay taxes rather than imposing broad measures that could further burden ordinary citizens.
Fr Dr Mutale argued that the country was missing opportunities to generate more revenue from its mineral resources, particularly during periods when international commodity prices were favourable.
“Our view is that when we do these negotiations and agreements with the mines, let’s do it for a time when conditions are way better than the conditions that are prevailing or that are projected at the point that the agreements are signed, so that we can benefit,” he said.
He said Zambia could introduce windfall taxes when mineral prices exceeded projections, allowing the country to benefit from unexpected increases in commodity prices.
Fr Dr Mutale also called for mining companies to be compelled to procure more goods and services from local suppliers, saying this would support domestic businesses and generate economic benefits beyond taxes.
He said Government’s debt obligations were also limiting resources available for social protection, health, education and agriculture.
Fr Dr Mutale noted that expenditure on domestic and external debt servicing was higher than allocations to the entire health and education sectors, as well as agriculture and social protection.
He said excessive domestic borrowing also made it difficult for local businesses to access affordable capital, undermining efforts to grow the economy and create employment.
And Fr Dr Mutale has said the Basic Needs and Nutrition Basket (BNNB) for a family of five has increased to K12, 253.72 in October from K11, 399.64 in September.
“This increase reflects the growing cost of meeting basic household needs and places additional pressure on households, particularly the poor and low-income families already struggling to afford essential goods and services,” Fr Dr Mutale said.
Fr Dr Mutale said the increase was largely driven by rising prices of essential food commodities, particularly vegetables and bananas.
“Notable increases were recorded in the cost of vegetables, which increased from K763.97 to K1, 122.57 for a 40kg bag and bananas which went up from K18.95 to K29.06 for 1kg,” he said.
Fr Dr Mutale said the price movements highlighted continued volatility and seasonal effects on food prices, with vegetables such as bondwe and pumpkin leaves becoming scarce during the hot season.
“The prices of food items are expected to increase as the dry spell continues due to El Niño,” he said.
Across the 16 districts monitored, the October basket averaged K7, 660.84, with Lusaka recording the highest cost at K12, 253.72, followed by Ndola at K10, 449.46 and Solwezi at K9, 646.87.
Ends.