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.