New taxes to kick off on Wednesday

0Shares

An array of new taxes introduced by Treasury will take effect on the 1st of January 2025 as contained in the 2025 Nation Budget Statement presented last month by Minister of Finance, Economic Development and Investment Promotion, Professor Mthuli Ncube.

The new Fast Foods Tax of 1% on the sales value of fast food items like pizzas, burgers, and French fries will take effect from the 1st January 2025 to encourage healthy eating, while a betting tax rate of 10% withholding tax on gross winnings of sports betting punters will also be effective from the 1st of next month.

A 20% plastic carrier bag tax on the sale value of plastic carrier bags aimed at promoting biodegradable alternatives to protect the environment. Properties converted from residential to business use will also attract a 25% tax on their rental income effective the 1st of January 2025.

Treasury also increased some selected taxes including the capital gains tax on marketable securities to be revised from a temporary 2% withholding tax to a final 1% tax from the 1st of January 2025.

Excise duty on alcoholic beverages will be increased from 25 cents per litre to 30 cents per litre, effective from the 1st of January, 2025.

Royalties on quarry stones will be a flat 0.5% of their sales value.

On the other hand, Treasury with effect from the 1st of January 2025 will reduce customs duty on electrical vehicles imported into the country to reduce carbon emissions. It will also remove value added tax (VAT) on liquefied petroleum gas (LPG) and reduce the sugar tax to boost the drinks manufacturing sector.

Meanwhile, Treasury, which has been disturbed by low and late revenue collection, has reduced the days within which companies that collect VAT have to remit it to ZIMRA to improve the situation.