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Zambia Publishes Sales Tax FAQ and Inputs Proposed for Sales Tax Exemption — Orbitax Tax News & Alerts

The Zambia Revenue Authority has published a sales tax frequently asked questions document (FAQ) and a list of inputs proposed for sales tax exemption, dated 3 May 2019. The FAQ and list have been published as part of efforts to prepare for the intended replacement of the value added tax regime with a sales tax regime from 1 July 2019. The legislation for the change is currently before Zambia's parliament ({News-2019-04-10/P/4-previous coverage}).

The FAQ provides answers to various questions regarding sales tax, including on the nature of the tax, who is required to register (annual turnover ZMW 500,000), the rates (9% local supplies / 16% imports), and other issues. The list of inputs proposed for exemption includes over 1300 items organized by HS heading and code, including in the areas of:

  • Accommodation and food service activities;
  • Agriculture, forestry, and fishing;
  • Arts, entertainment, and recreation;
  • Construction;
  • Electricity, gas, steam, and air conditioning supply;
  • Financial and insurance activities;
  • Information and communication;
  • Manufacturing; and
  • Mining and quarrying.

The list is subject to change by the time the new sales tax regime is approved and implemented and will likely be subject to ongoing adjustment.