Zimbabwe's Minister of Finance, Economic Development and Investment Promotion Mthuli Ncube presents the 2024 National budget at the parliament building on the outskirts of Harare, Nov 30, 2023. (PHOTO / AP)

HARARE - Zimbabwe's Minister of Finance, Economic Development and Investment Promotion Mthuli Ncube on Thursday proposed a "wealth tax" that targets the country's super-rich with an intention to use the funds earned from the new measure to upgrade urban infrastructure.

Presenting the 2024 national budget statement to Parliament, Ncube said the current tax structure was benefiting the rich at the expense of those who earned less.

Senior citizens will however be exempted from the new tax, and the principal private properties owned by elderly persons above the age of 70 years would be spared, the minister said

He said the tax policy is aimed at redressing the fact that individuals in a low-income category paid a higher percentage of their income compared to individuals in higher income brackets.

Because of the old tax policy, "the tax incidences fall disproportionately on the low-income groups resulting in inequality," he said.

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"In order to ensure that every person contributes to the fiscus in line with their levels of income, I propose to introduce a wealth tax at a rate of 1 percent of the market values of residential properties with a minimum value of $100,000," Ncube said.

"Resources derived from the levy will be used for urban infrastructure development, in particular roads, water, sewage and community health centers," he said.

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Senior citizens will however be exempted from the new tax, and the principal private properties owned by elderly persons above the age of 70 years would be spared, the minister said.

Many of the country's rich people own more than one residential property as a store of value and also accrue income from rentals.