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The Confederation of Zimbabwe Retailers (CZR) has urged the government to act swiftly in addressing mounting challenges that threaten the survival of the formal retail sector. Rising taxes, strict regulatory policies, and an expanding informal market have created a tough business environment, leading to widespread store closures and financial strain for retailers.
Despite these difficulties, the retail industry remains a key pillar of the economy, providing jobs, tax revenue, and ensuring food security. However, CZR President Dr. Denford Mutashu warned that if immediate solutions are not implemented, the sector could collapse, resulting in job losses and further economic instability. He pointed to high compliance costs, multiple taxation policies, and exchange rate distortions as major factors making it difficult for retailers to operate profitably.
While acknowledging the sector’s struggles, Reserve Bank of Zimbabwe Governor Dr. John Mushayavanhu suggested that some challenges stem from internal mismanagement rather than just economic conditions. Speaking during the presentation of the 2025 Monetary Policy Statement, he announced an extension of the targeted trade facility to support retailers with working capital, a move aimed at boosting the sector’s stability.
By Ruvarashe Gora
CZR also raised concerns about the growing dominance of informal traders, who operate with minimal regulatory oversight and undercut formal businesses by avoiding taxes and licensing fees. Dr. Mutashu stressed that instead of burdening compliant retailers with excessive taxation, the government should introduce a structured tax system that encourages small businesses to transition into the formal economy. He suggested a presumptive tax model to gradually integrate informal traders into the tax base while reducing the financial strain on formal retailers.
Excessive licensing requirements were another issue highlighted, with Dr. Mutashu noting that retailers must secure over 30 different permits to remain fully compliant. He called for streamlined regulations that reduce bureaucracy and create a more business-friendly environment, in line with President Mnangagwa’s recent commitment to ensuring that regulatory fees and permits do not stifle business growth.
CZR also pushed for exchange rate liberalization, arguing that strict currency controls prevent retailers from pricing goods competitively, disrupting supply chains and reducing profitability. Additionally, the organization advocated for reducing the Intermediated Money Transfer Tax (IMTT) on foreign currency transactions and removing it entirely for transactions in the Zimbabwe Gold (ZiG) currency to promote financial inclusion and encourage electronic payments.
As retailers continue to grapple with an uncertain business climate, CZR emphasized the need for immediate reforms to stabilize the sector and restore investor confidence. Without urgent policy adjustments, the formal retail industry risks further decline, potentially worsening Zimbabwe’s economic challenges.
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