Value-added Tax (VAT) legislation and its regulations presents a unique interpretation challenge because of its intricate system of classifications of goods and services. A correct classification is essential in managing VAT compliance and for enhancing shareholder value. The article, therefore, explain these categories, highlighting their roles and implications within the VAT framework.Acco ...
Zimbabwe’s Special Capital Gains Tax on Mining Titles
Zimbabwe, with its rich mineral resources, has long relied on the mining sector as a cornerstone of its economy. Recognising the potential of mining for national development, the government has introduced a special capital gains tax on entities which acquire or transfer mining title and interest. This article unpacks the special capital gains tax, providing clarity on its mechanisms, implications, ...
Unpacking the new wealth tax in Zimbabwe
In Zimbabwe, the topic of taxation often brings complex jargon and detailed legal frameworks that can be challenging to navigate for the average person. One such area is the 1% Wealth Tax introduced through Finance Act 13 of 2023 with effect from 1 January 2024. This article unpacks who is affected by this tax, the role of city councils in its administration and other practical considerations. At ...
Zimbabwe’s VAT Reform: Balancing Revenue Growth with Consumer Affordability
Zimbabwe recently embarked on a significant journey to revamp its tax structure, bringing considerable changes to its Value Added Tax (VAT) system. This decision, aiming to streamline the tax process, has led to a notable shift from the zero-rated category of VAT to a tax-exempt system for certain goods. Goods and services fall into three categories in the VAT Act. They can be either standard rate ...
Zimbabwe’s New Domestic Minimum Top-Up Tax
Zimbabwe's introduction of the Domestic Minimum Top-Up Tax (DMTT) marks a paradigm shift in the taxation of foreign entities operating within the country. The DMTT is meant to foster a fair and effective tax system in line with global rules. This article unpacks the complexities of this new tax for multinational corporations.At its core, the DMTT is a tax levied on the income of foreign entities a ...
Zimbabwe’s Sugar Tax: A Public Health Necessity
The taxation of sugar-sweetened beverages (SSBs) has been brought to the forefront as a key public health intervention strategy amidst the global health crisis. The SSB taxation is endorsed by the World Health Organisation (WHO) and the United Nations Children's Fund (UNICEF) and is hailed as a "best buy" policy to curb the proliferation of certain health issues. The implementation of such a tax c ...
IMTT removal and the tradeoff.
The Monetary Policy Committee (MPC) of the Reserve Bank of Zimbabwe (RBZ) recommended that the government removes IMTT on transactions that are intermediated through plastic bank cards and other digital platforms. The recommendation was part of resolutions of the MPC meeting held on the 23rd of October 2023. Prior to the MPCs meeting, another organ of the country, the Confederation of Zimbabwe Ind ...
Employees Tax- Pay As You Earn
The end of the month is approaching, which is a joyous time for a number. It is at this point that you hear employees calling their employers names since their net- pay would not be matching with the gross income specified in their contracts. PAYE and NSSA are the main causes, and some have referred to them as the devils of their era. Allow me to walk you through the Pay As You Earn system for emp ...
VAT dilemma of construction projects
The construction industry plays a crucial role in the development of any economy. With Zimbabwe’s economic development agenda being premised on 14 pillars under the National Development Strategy, infrastructure development is said to be central to the achievement of the country’s economic goals. In pursuance of the same, the government set aside money for the sector in the 2023 national budget. Th ...
ZiG: Transforming Zimbabwe’s Payment Landscape through Gold-Backed Innovation
On October 5th, 2023, Zimbabwe witnessed a significant shift in its domestic payment landscape with the introduction of Zimbabwe Gold (ZiG), a novel means of payment backed by physical gold. We focus on the implications and motivations behind this policy change, exploring the potential impact on financial stability, risk mitigation, and the broader transition towards digital payment methods.The in ...