"The Former Head of States Act is clear: any former head of state who returns to active politics forfeits his retirement benefits, including all other entitlements due to the office of the former head of state," Chief Government Spokesman Joseph Katema told The Anadolu Agency in an exclusive interview on Thursday.
"The [former] president, of his own will, decided to disregard the provision of the law as provided for in this act," he said, referring to Banda.
"We have, therefore, no other option but to invoke the provision of this very act," Katema insisted.
Banda had told AA in October that he was contemplating what he said were mounting public calls for him to come out of retirement and contest 2016 polls.
He has since decided to contest upcoming presidential by-elections prompted by the death in late October of former president Michael Sata in a London hospital.
Katema said Banda now had seven days to vacate and surrender all state properties entrusted to him following his retirement after losing the 2011 election.
"Failure to do so will force state agents to act against the former head of state," Katema told AA.
According to the Former Head of States Act, former heads of state are entitled to a tax-free monthly pension amounting to 80 percent of the incumbent president's salary, a furnished home, office accommodations, three motor vehicles and three drivers, among other things.
Other benefits include a personal secretary; three security guards; administrative assistance in the form of permanent secretaries; three domestic assistants; a diplomatic passport; medical insurance; and funeral expenses upon his death.
Katema insisted that no former Zambian presidents had ever gone back to active politics since the country's return to multiparty politics in 1991.
"Mr. Banda is not a special citizen who can be allowed to do whatever he wants at any given time," he told AA.
Banda, for his part, blasted the government's decision.
"The action by government to withhold my benefits is an act of daylight robbery," he told AA.
"There is no way the government can do this to me because it [retirement benefits] is my entitlement," the ex-president asserted.
Banda, who ruled Zambia from 2008 to 2011, said he plans to challenge the decision in court.
"As we speak, my lawyers are working around the clock to bring back my benefits," he said.