Zimbabwe's finance minister dropped a new tax that hits people pulling US dollars out of banks. The government wants to push everyone toward digital payments because physical American cash makes up most transactions and lets people dodge taxes easier.
Individual withdrawals under $500 monthly stay tax-free but anything between $501 and $1000 gets hit with 2 percent, while amounts over that face 3 percent. Companies get higher thresholds with no tax up to $5000 then the same rate structure kicks in. Banks already charge 3 percent on withdrawals before this new levy even starts.
Financial sector people immediately trashed the plan, saying it just pushes customers away from formal banking and sends transactions straight back underground. One anonymous banker called it another shocker that discourages people from using banks at all. The minister pointed out that ATM withdrawals average around $265 million monthly, with a peak hitting $353 million, forcing banks to keep almost $1 billion ready just to meet demand.
Individual withdrawals under $500 monthly stay tax-free but anything between $501 and $1000 gets hit with 2 percent, while amounts over that face 3 percent. Companies get higher thresholds with no tax up to $5000 then the same rate structure kicks in. Banks already charge 3 percent on withdrawals before this new levy even starts.
Financial sector people immediately trashed the plan, saying it just pushes customers away from formal banking and sends transactions straight back underground. One anonymous banker called it another shocker that discourages people from using banks at all. The minister pointed out that ATM withdrawals average around $265 million monthly, with a peak hitting $353 million, forcing banks to keep almost $1 billion ready just to meet demand.
