The Bulawayo City Council (BCC) has proposed a $2.8 billion ($2,779,412,294) budget for 2020 that will see rates increasing by as much as 500 percent.
This is after residents will have endured a 300 percent increase in rates from October until the end of the year.
Presenting the 2019 second supplementary budget and the 2020 proposed Budget, Monday, Finance and Economic Development Committee acting chairperson Councillor Mzamo Dube bemoaned the hyper inflationary environment for destabilising council finances.
Cllr Dube said the unpredictable economic situation in the country negatively affected the 2019 budget which had been crafted in September 2018.
“For the 2019 second supplementary budget to be effective, all tariffs should be increased by 300% effective from October 2019. The 2020 budget will witness an increase of 416% on all tariffs on the current budget effective January 1, next year,” he said.
Cllr Dube explained this is due to the state of the economy which remains unpredictable, forcing the local authority to monitor economic indicators and pronouncements.
“In February 2019, the government issued the Statutory Instrument 33 of 2019 which promulgated the RTGS as legal tender. This was followed by the introduction of the Foreign Currency Inter-Bank Market between the US$ and the RTGS which opened on 22 February at US$1.00: RTGS$2.50,” he said.
“On 24 June 2019, SI 142 of 2019 was enacted which prescribed that the Zimbabwean Dollar (ZWL) as the sole currency for domestic transactions. On inflation and according to data collated by the Zimbabwe National Statistics Office, year on year inflation for the period to 30 June 2019 increased from 97.85% in May 2019 to reach an all time high of 175.66 percent in June of 2019,” added Cllr Dube.
The council condemned the introduction of 2% of Intermediated Money Transfer Tax (IMTT) citing the taxation system significantly increased council costs.
Cllr Dube said the council is mandated to deliver quality services to the residents hence for it remain afloat tariff increases are inevitable.
“As we deliberate on this Budget, it is important therefore that we focus on where we want to go as a City. The budget activities and our priority list should motivate all of us to walk this painful journey to glory,” he said.