Zimbabwe: Key Tax Developments 2026

Zimbabwe introduced wide-ranging tax reforms aimed at broadening the revenue base, strengthening compliance, and attracting targeted investment. A key change is the increase in Value Added Tax (VAT) from 15% to 15.5%, coupled with revised rules on mixed supplies and the requirement to account for VAT on imported services in foreign currency. These measures necessitate immediate adjustments to pricing models, systems, and compliance processes.

International taxation was significantly reinforced through the introduction of a 15% Domestic Minimum Top-Up Tax (DMTT) applicable to multinational enterprises with global revenues exceeding €750 million. In addition, the permanent establishment threshold has been reduced from 183 to 90 days, materially expanding Zimbabwe’s taxing rights over foreign entities operating in the country.

Revenue mobilization is further enhanced through new and revised taxes. These include 15% non-residents’ tax on interest, 15% digital services withholding tax on cross-border payments, and a 15% presumptive rental income tax on landlords. The gaming sector is also now subject to higher taxation, with operators taxed at 20% of gross takings and punters at 25% on winnings.

Transaction-based taxation has also been recalibrated. The Intermediated Money Transfer Tax (IMTT) is reduced to 1.5% for local currency transactions, maintained at 2% for foreign currency transactions, and now subject to a transaction cap. Notably, IMTT is now deductible for corporate income tax purposes, providing limited relief.

Sector-focused measures targeted mining and the digital economy. Mineral levies and export taxes have increased, particularly on lithium and chrome, while virtual asset service providers are now subject to formal registration and regulatory compliance requirements.

On the incentive side, Zimbabwe introduced targeted measures to stimulate investment and employment. These include a youth employment tax credit of USD 1,500 per employee and a preferential 15% corporate tax rate for qualifying business process outsourcing firms.

Overall, the reforms reflect a dual policy objective of strengthening domestic revenue mobilization and improving investment competitiveness. However, the scale and scope of the changes increase compliance demands that require proactive tax planning, system upgrades and enhanced governance by businesses.