By Nyasha Nigel Machiri, Baker Tilly Chartered Accountants, Zimbabwe
Following the announcement of the Zimbabwe 2020 National budget, Zimbabwe’s Minister of Finance and Economic Development on 14 November provided some clarity on the proposed taxation of e-commerce transactions.
The taxation threshold for e-commerce transactions is USD $500,000.
The tax was introduced in Zimbabwe in January 2019 on income from foreign domiciled satellite broadcasting services in respect of the provision or delivery of television or radio programmes, and on electronic commerce operators in respect of the provision or delivery of goods or services in Zimbabwe. The rate is a flat 5%.
The income is deemed to be from a source within Zimbabwe as provided by an amendment to Section 12 of the Income Tax Act. Since the tax is a final tax on gross revenue, the 2020 budget proposes to remove assessed losses from the computation of taxable income for these electronic commerce platform operators.
Furthermore, it has been proposed that non-resident persons that provide satellite broadcasting services or facilitate trade of goods and services through electronic commerce platforms should appoint a representative taxpayer within 30 days of becoming liable to tax.
Note that the budget has not yet been adopted by Zimbabwe’s parliament.
–Nyasha Machiri is a Senior Tax Consultant at Baker Tilly Chartered Accountants.
Well done Nyasha