Finance Minister Mthuli Ncube missed April’s revenue collection targets by 11 % owing to the impact Covid-19 lockdown had on businesses that were grounded to a halt as part of measures to minimise the spread of the virus.
The Consolidated Statement of Financial Performance of the Consolidated Revenue Fund for the month of April 2020 reveals the emergence of the negative variance.
“Total revenue collection for the month of April 2020 amounted to $3.8 billion against a target of $4.3 billion resulting in a negative variance of $493.2 million which stands at 11%,” the statement said.
Since assuming office, Ncube has been declaring budget surpluses but unfortunately, the trajectory has been negatively affected by the global pandemic’s toll on local businesses.
The statement shows that taxes on the income contributed $1 billion against a target of $745.3 million giving a positive variance of $323 million.
Goods and services taxes contributed $2.6 billion against a target of $3.4 billion giving a negative variance of $808.3 million.
“This was mainly due to less trading activities on the market during the lockdown,” the statement noted.
Customs duty recorded a negative variance of $532.7 million and excise duty a negative variance of $381.5 million.
Taxes on financial and capital transactions recorded a positive variance of $197.3 million. The result was attributed to intermediate money transfer tax which contributed $786.8 million against a target of $590 million due to an increase in the use of mobile money transfers during lockdown by the public.
During the same month, non-tax revenue recorded a negative variance of $7.9 million. The negative variance is attributed to property income which did not meet the target by $25.7 million.
Expenses on the use of goods and services amounted to $713 million against a target of $660.8 million giving a variance of $52.6 million.
The budget incurred a deficit of $344.5 million against a targeted deficit of $805 million.
The poor performance comes at a time when civil servants are demanding salary increments owing to the rise in cost of living which have seen prices of basic goods and services going beyond the reach of many.