Finance and Economic Development Minister Mthuli Ncube has scrapped the widely criticised progressive tax on US dollar cash withdrawals, following mounting pressure from legislators, businesses, and the public.
The announcement was made during parliamentary debates on the Finance Bill for the 2026 National Budget, where the clause introducing the tax was officially removed.
Originally unveiled on 27 November 2025, the tax proposed a tiered system on individual USD cash withdrawals:
- 0% on withdrawals up to US500/month
- 2501 and US1,000
- 31,000
Higher thresholds were set for corporate withdrawals.
The proposal sparked widespread backlash, with critics arguing it would push people away from formal banking, hurt low-income earners, and fuel informal market transactions—defeating its intended goals of curbing cash hoarding and promoting digital payments.
Responding to the growing opposition, the government has now completely removed the clause from the Finance Bill, marking a rare policy reversal in response to public outcry.
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