The VAT standard rate in the Finance Act has been proposed to be reduced from 15% to
14.5%.
The threshold for VAT registration is being increased from the current ZWL 60,000 to ZWL 1,000,000.
Amendments are proposed to section 13 of the VAT Act to include the supply of:
In both cases the supply shall be deemed to be a supply made in Zimbabwe.
The obligation to charge and account for the tax rests on the supplier or his or her duly appointed representative in Zimbabwe.
An amendment has been proposed for the definition of input tax in section 2 of the VAT so that it includes imported services. The intention is to allow registered operators to claim input tax.
Duty free concessions have been extended to the following industries in Zimbabwe to enable them to grow:
The Zimbabwe Government has allowed the duty free importation of capital equipment that includes buses and game viewing vehicles.
Duty free exemptions have been given to luxury bus operators. Luxury buses may be imported duty free by approved operators.
The dairy industry, pharmaceutical industry, vehicle assemblers, and suitcase and bag manufacturers enjoy duty free import of their raw materials.
The Zimbabwe Government has established inland Customs Dry Ports to ease congestion at borders. Final clearance of goods will now be done at these dry ports.
At the end of their studies, students who have been on a course or study outside Zimbabwe are entitled to bring back to Zimbabwe personal goods including a vehicle duty free. A ZWL 5,000 limit has been put on the value of the vehicle. This restriction is intended to curb the abuse of the facility by returning students who were being sponsored to import luxury vehicles.
Pauline Mukamba
pmukamba@bdo.co.zw