Gvt revises corporate tax payment guidelines for 2nd quarter

Business Reporter

The Ministry of Finance, Economic Development, and Investment Promotion has announced new guidelines for the payment of 2024 second-quarter corporate taxes.

In a press statement released by Finance Minister Professor Mthuli Ncube, Government outlined one of the key points on the new guidelines for corporate income tax payments.

“I wish to advise that payment of Corporate Income Tax should be guided by the provisions of Section 4A of the Finance Act [Cap. 23:04], which provides for payment of tax in the equivalent proportion of the currency of trade.

 For instance, if a company conducts 60% of its transactions in local currency and 40% in foreign currency, the corporate income tax should be paid in the same ratio,” the Minister explained.

The Minister said, for the second quarter of 2024, the Treasury has granted authority for corporates to pay their taxes on a 50:50 basis, in both local and foreign currency. This temporary measure is designed to ease the transition and provide flexibility for businesses during this period.

“Notwithstanding the current legislative provisions, Treasury authority is hereby granted for corporates to account for the 2024 Second Quarter Corporate Income Tax obligations in both local and foreign currency on a 50:50 basis.

Companies that have already paid their second-quarter taxes under the existing provisions will have their transactions managed administratively by the Zimbabwe Revenue Authority,” said the Finance Minister.

Additionally, Professor Ncube highlighted that businesses and the general public now have the option to pay government fees and charges in local currency unless specified otherwise.

 "I am also pleased to advise that business and the general public have the option to pay Government fees and charges in local currency, unless where specified to the contrary.

Customs duty on imported goods will also be payable in local currency, with exceptions for designated non-essential or luxury products, which will still require payment in foreign currency,” he said

The Minister also said that as part of the broader review, the Treasury would soon specify which taxes would exclusively be payable in local currency, with necessary legislative support to be sought from Parliament.

 “As part of the comprehensive review of the Framework of Tax Payments, Treasury will, in due course, specify the taxes which will exclusively be payable in local currency, and the necessary supportive legislation, with the requisite approval by Parliament,” Professor Ncube confirmed.

Meanwhile, Government is keen to solidify the gains achieved with the introduction of the ZiG currency and to ensure that the fiscal and monetary policies are well-coordinated to maintain economic stability.