CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Zambia Delays VAT Again, Until September

Zambia Delays VAT Again, Until September

by Lorys Charalambous,, Cyprus

05 July 2019

Zambia has once again pushed back implementation of a sales tax in place of value-added tax, to September 1, 2019.

The Government said it was not ready to implement the regime on July 1, 2019.

The regime was intended to be in place from April but was delayed to allow for more time for consultations with taxpayers and other stakeholders.

The tax agency released guidance on the new regime in the form of FAQs on May 3, 2019.

The FAQs confirm the following details of the regime:

Registration obligations

Businesses with an annual turnover of K500,000 (USD39,000) will be obligated to register and charge sales tax. One-off transactions will not be included in turnover for the purposes of determining whether a business should register.

Providers of certain services will be required to be registered for sales tax regardless of whether they meet the registration threshold or not. The Minister of Finance will by statutory order prescribe the categories of suppliers that will be required to be registered regardless of turnover.


The regime will feature two rates:

  • A 16 percent sales tax rate will apply on imported goods and services;
  • A 9 percent rate will be charged on goods and services supplied by domestic businesses.


The following goods and services will be exempt:

  • Inputs used in production and capital goods;
  • Supplies to designated privileged persons such as diplomats;
  • Exports; and
  • "Basic and essential" goods, such as:
    • maize;
    • soya beans;
    • cassava;
    • bread;
    • eggs;
    • poultry, livestock, and fish.

The following will also be exempt:

  • health services and related supplies;
  • education services;
  • water supply services;
  • transactions for the sale or lease of an interest in land, other than the sale, lease, or rental of commercial property.

VAT refunds

The Government says it will honor legitimate refund claims. It said: "During the transitional period between VAT and sales tax, tax account reconciliations will be undertaken to close off VAT and a plan will be put in place of how to liquidate the legitimate refunds."

"VAT transactions are expected to be completed three months into the implementation of the sales tax in accordance with the provisions of the Sales Tax Act. There will be no further claims or returns after this period. A final return will be filed for VAT to conclude all the VAT transactions at the close of the prescribed accounting period."

"The final return will not be allowed on the system where the taxable supplier has missing returns," it said.

Filing obligations

The due date for returns and payment of sales tax will be the 18th day following the end of the accounting period, while the due date for the returns and payment for withholding sales tax will be the 16th day following the end of the accounting period.

Taxable suppliers who submit their sales tax or withholding sales tax returns after the due date will be charged penalties. Further, failure to pay the tax by the due date will also attract penalties, the tax agency said.

TAGS: Finance | tax | business | sales tax | mining | interest | accounting | education | Zambia | penalties | services | VAT refunds | Providers | Tax

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »