Below are the various taxes applicable to investments on the Zimbabwe Stock Exchange:
Stamp Duties on purchase of share
A Stamp Duty of 0.25%, that is 25 cents per each $100 or part thereof, is payable on the purchase of shares.
Tax on Capital Gains (CGT)
There is a Capital Gains Tax payable on capital gains realised from the sale of specified assets (immovable property, shares and other securities). The general rate of CGT is 20%. Sale of listed securities is subject to 1% Withholding Tax on the gross proceeds with effect 01 August 2009 and are currently exempt from Capital Gains.
Sale of unlisted securities is subject to Withholding Tax at 5% of gross proceeds.
Withholding Tax on dividends
Resident Shareholders’ Tax on dividends
A resident shareholder’s tax is deducted at source from dividends paid by Zimbabwean companies. The general rate is 15%. A special rate of 10% applies for companies listed on ZSE.
Non Resident Shareholders Tax on dividends
A non-resident shareholders tax is deducted at source from dividends paid by Zimbabwean companies. The general rate is 15%. A special rate of 10% applies for companies listed on ZSE.
Tax on Business Profits
Income Tax on business profits are generally taxed at 25% though the rate may differ for specialised industries. This tax is payable on income derived from, or deemed to be from a source within Zimbabwe. In addition a 3% Aids levy based on the tax is charged.
Tax on Employment Income
Employers are required to withhold tax (Pay As You Earn) from remuneration paid to their employees. The rates range from 0% on the low income brackets to 45% on the higher brackets. In addition a 3% Aids levy based on the tax is charged.
Value Added Tax (VAT)
The rate of VAT is 15%. Exemptions and Zero Rating apply on various goods and services that are considered essential.