The 2027 Budget: my first reaction
This afternoon the Minister of Finance presented a K284.8 billion budget for 2027. We will study it line by line and publish a full analysis in the coming days. For now, here are my first thoughts.
One kwacha in every four goes to debt. K67.6 billion will be paid to lenders, banks and bondholders. That is more than twice what we will spend on health (K30.3 billion) and far more than education (K38.2 billion). The stability the IMF praises is being paid for by our people.
The poor are asked to pay again. VAT goes up to 16.5 percent. The mobile money levy goes up in every band, and that is the levy paid by the marketeer and the family sending money to the village. Sugar gets a new tax of K1 per kilogram. Passport and civil registration fees go up. These taxes do not ask whether you are rich or poor.
Our farmers will start the season in debt. FISP is to become a loan scheme. Peasant farmers who already struggle to break even will now owe the state before they plant.
K15 a day. The social cash transfer rises by K50 to K450 a month. That is K15 a day for a household.
There is one step in the right direction. At last there is a tax on dividends paid by mining companies, which until now paid nothing on them while copper hit record prices. This step is overdue, and it is small.
The Minister told us growth must be private sector led and driven by foreign investors, with prime land along the railway corridors for large investors and state companies opened to partial sale. We have heard this before
The question for any budget is simple: who does it serve? On first reading, this one serves the lenders and the investors first, and ordinary Zambians last.
Full analysis to follow.
Fred M’membe
SP President