Taxation

The Zambia Revenue Authority (ZRA) is responsible for handling all related tax matters in Zambia under the Ministry of Finance. The principal taxes include:

  • direct taxes - corporate tax, Pay-As-You-Earn, other personal income
  • Customs and Excise duties
  • Value Added Tax (VAT)
  • property transfer tax
  • mineral royalty (Mines and Minerals Act 1995).

The standard corporate tax in Zambia is 35 per cent, but there are numerous tax incentives to promote investments into different sectors. For instance, income from the agricultural sector and non-traditional exports (all exports except copper and cobalt) is levied at 15 per cent, while companies listed on the Lusaka Stock Exchange are taxed at the rate of 33 per cent.

The Value Added Tax (VAT) of 16 per cent applies to both goods and services of domestic production and those that are imported. VAT is levied on the Cost, Insurance and Freight (CIF) value, plus customs tariff and exemptions include social services such as health, education and funeral services.

Some specified goods and services are zero-rated or exempt. Registration for VAT purposes is mandatory for every dealer in or supplier of standard rated and zero-rated goods and services, as defined in the VAT Act No. 4 of 1995 (which replaced sales tax), whose taxable turnover exceeds K200 million per annum.