Government removes VAT on some basic products

The Ministry of Finance and Economic Development has announced the repeal of Statutory Instrument 20 of 2017, which provided for the charging of Value Added Tax (VAT) at a standard rate of 15% on beef, chicken, fish, rice, potatoes, margarine and mahewu.

In terms of StatutoryInstrument 26A of 2017 , the goods are now exempt from VAT, which means that no VAT will be chargeable on the specified items.

Be the First to get the Latest Edition of the Zimborderguide, please subscribe to our newsletter to receive your Free Copy

Value Added Tax is an indirect tax on consumption, charged on the supply of goods and services. It is levied on transactions rather than directly on income or profit, and is also levied on the importation of goods and services. This tax was introduced in 2004 to replace Sales Tax.

The VAT standard rate applies to supplies of goods and services which attract VAT at the rate of 15 per cent. Generally, all goods and services are standard-rated unless if they are specifically exempted or zero-rated.

For zero-rated supplies, the rate of VAT is zero per cent. The zero rate applies to exports of goods from Zimbabwe and some basic foodstuffs such as sugar and mealie-meal.

No VAT is chargeable on exempt supplies, such as financial services, provision of electricity for domestic use, provision of piped water for domestic use and rates charged by local authorities.

Be the First to get the Latest Edition of the Zimborderguide, please subscribe to our newsletter to receive your Free Copy

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s