IMF wants tax on mosquito nets in Zambia

31 January 2007

An IMF document provoked ire in Zambia by asking the government to remove value added tax exemptions on a range of goods, including mosquito nets used to fight malaria. The non-public document, Zambia – Key Issues of Tax Reform, also called for taxes on food items, agricultural goods and water and sewage services. The former and current presidents quickly dismissed the proposals and opposition parties organised protests against the moves. The IMF’s new resident representative, Birgir Anarson, distanced himself from the specifics of the plan soon after arriving in country, maintaining that the government needed to increase taxes but that “it is up to the government to decide how they raise the revenue.” The IMF mission that visited Zambia in November indicated in its mission concluding statement that “tax revenue should be boosted so as to contain government’s domestic borrowing while providing scope for increased spending on infrastructure and social programs to meet the national development goals.”