New taxes take effect on January 1

Blessings Chidakwa, Harare Bureau

NEW taxes introduced by Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, will come into effect on January 1, as outlined in the 2025 National Budget Statement.

The National Budget, already passed by Parliament, includes a range of measures such as taxes on fast foods, betting, and plastic carrier bags.

Prof Ncube presented the ZWG276,4 billion (about US$7,5 billion) budget on November 28, under the theme, “Building resilience for sustained economic transformation”.

“We won’t be monetising any additional Government debt, which would cause volatility or growth in money supply, leading to currency instability and inflation. Fiscal discipline is key. The budget supports our discipline in the monetary sector to ensure both monetary and fiscal stability,” he said.

A 10 percent withholding tax on gross winnings of sports betting punters will also be implemented.
According to the national budget, the new fast foods tax will impose a 1 percent levy on the sales value of fast food items like pizzas, burgers, and French fries to encourage healthy eating.

To promote biodegradable alternatives and protect the environment, a 20 percent plastic carrier bag tax on the sale value of plastic bags will also be effective.

The temporary suspension of customs duty on imported public service buses will end on January 1, 2025.
Properties converted from residential to business use will attract a 25 percent tax on their rental income.

The Treasury has also increased some selected taxes, including revising the capital gains tax on marketable securities from a temporary 2 percent withholding tax to a final 1 percent tax.

Excise duty on alcoholic beverages will rise from 25 cents per litre to 30 cents per litre.
Royalties on quarry stones will be a flat 0,5 percent of their sales value.

The Government has reduced customs duty on electric vehicles imported into the country to lower carbon emissions.

Additionally, value-added tax (VAT) on liquefied petroleum gas (LPG) will be removed, and the sugar tax will be reduced to boost the drinks manufacturing sector.