Zimbabwe’s Finance Act 2025, effective from 1 January 2026, introduces major tax reforms across income tax, VAT, capital gains tax and mining levies, including a new Domestic Minimum Top-Up Tax for large multinational groups, expanded mining and export duties, and new incentives for digital services, BKPO operators, and sports infrastructure investments.
Zimbabwe has introduced a range of tax measures in its National Budget for 2026, which were enacted through the Finance Act 2025 (Act No. 7 of 2025) on 29 December 2025.
The Finance Act of 2025 introduces significant amendments to existing tax laws, including updated provisions for income tax, value-added tax (VAT), and capital gains tax. Key updates include the implementation of a Domestic Minimum Top-Up Tax for multinational groups and the introduction of a presumptive rental income tax for property owners.
Furthermore, the Act tightens regulations on the mining and export of minerals such as lithium and gold, while reserving certain industries, such as brick moulding and granite mining, for local indigenous players. Finally, the legislation modernises administrative processes by mandating electronic payment systems and the use of fiscal devices for tax authentication.
The key tax changes are summarised below:
Corporate tax and global minimums
A standout feature of the new legislation is the introduction of a Domestic Minimum Top-Up Tax (DMTT). This targets multinational enterprises (MNEs) with annual revenue of EUR 750 million or more. If their combined effective tax rate in Zimbabwe falls below 15%, they must pay a top-up tax to reach that minimum threshold.
The threshold for permanent establishment was reduced from 183 days to 90 days within a 12-month period. The Domestic Minimum Top-up Tax (DMTT) was strengthened to include a EUR 750 million turnover threshold, requiring affected groups to submit consolidated turnover under theCountry-by-Country Reporting rules.
Mining and export taxes
The Finance Act 2025 introduces several mining-related tax measures, including a new quoted price method for transfer pricing of mineral exports using reference prices from major metal exchanges, revised gold royalty rates based on price per ounce (3% up to USD 1,200, 5% for USD 1,200–5,000, and 10% above USD 5,000), and an increased Corporate Social Responsibility Levy of 3% for lithium, black granite, quarry stone, and dimensional stones, now also extended to coal.
The Act also imposes export taxes on lithium ore and concentrate (10%) and on antimony and unbeneficiated chrome (10%), while lithium sulphate is exempt from export tax.
VAT
VAT was increased from 15% to 15.5%. New rules require VAT on imported services to be declared and paid in the currency of trade (reverse charge). The VAT registration requirement for purchasing from wholesalers was relaxed for operators dealing only in VAT-exempt supplies.
Capital gains changes
A 20% capital gains tax was introduced on transfers of shares deriving value from Zimbabwe immovable property.
IMTT changes
The Finance Act 2025 reduces the IMTT rate on ZiG (ZWG) transactions from 2% to 1.5% while keeping the 2% rate for foreign currency transactions, and also makes IMTT a tax-deductible expense for corporate income tax purposes.
Digital services tax
A 15% digital services withholding tax was introduced on payments to offshore digital platforms (e.g., e-hailing, online content, satellite internet), replacing VAT on imported services. The tax must be withheld by paying agents, including financial institutions.
BKPO incentives
New incentives were introduced to support Business and Knowledge Process Outsourcing (BKPO) operators exporting services, including a 15% corporate tax rate, 100% first-year capital allowance, exemption from non-resident dividend tax, and a USD 1,500 per employee tax credit under the Youth Employment Tax Incentive.
Sports infrastructure incentives
Tax incentives were introduced for private investment in sports infrastructure, including a 150% accelerated capital allowance over 2 years for facility development and a USD 10,000 tax credit for companies that fund rural sports academies or youth programs.
These measures are effective from 1 January 2026.
