Zimbabwe: Direct and indirect tax proposals in 2026 budget

The 2026 national budget was presented on November 27, 2025. The 2026 national budget statement—with corresponding draft Finance Bill—includes the following tax proposals:

• Presumptive taxpayer rental tax on any rental income received by a registrable proprietor from a tenant who is liable for presumptive tax would be subject to a 10% withholding tax to be withheld and remitted to ZIMRA. Presumptive taxpayer rental tax means the tax payable by registrable proprietors.
• Permanent establishment (PE) definition would be amended to include a fixed place of business which consists of a building site or construction site where a company wholly or partly carried on business for a period of 90 days in 12 months of a calendar year. The PE would be established from the date of commencement of project or construction of site.
• Domestic minimum 15% top up tax would be introduced on high-earning foreign entities, defined as any multinational / international corporation whose consolidated turnover in the previous year of assessment is €750 million (€760 million per draft bill but €750 million in the budget statement).
• Deduction of carried forward assessed losses would be limited to 30% of the assessed loss at the end of tax period, and applicable to both general miners and special mining lease holders.
• An election to use the new mine method for claiming capital allowances would no longer be available. The balance of unredeemed capital expenditure would be divided by the estimated life of a mine.
• A corporate social responsibility levy of 2% on the gross value of coal would be introduced.
• Tax clearances would not be required for new registrants joining certain professions.
• Inclusion of the quoted price method for transfer pricing for minerals exported that makes reference to the London Bullion Market, the London Metals Exchange or the Shanghai Metals Market to determine arm’s length price of a controlled transaction.
• 15% withholding tax on interest paid to nonresidents (payable in U.S. dollars) would be reintroduced.
• Dividends declared by building societies would no longer be classified as interest, and would be treated as dividends, consistent with commercial banks.
• Mutapa investment fund income tax incentives would be backdated to January 1, 2025, and capital gains tax exemptions would apply from January 1, 2026.
• Value added tax (VAT):
  • When there is a mixed supply of goods or services as part of entertainment the supply would be deemed to be standard rated.
  • VAT on imported services to be paid in foreign currency.
  • Penalties to be introduced for failure to pay VAT on imported services.
• Export tax rates on unbeneficiated lithium (payable in U.S. dollars):
  • 10% of the fair market value of lithium ore
  • 5% of the fair market value of lithium concentrate
  • 0% of the fair market value of lithium sulphate
• Special capital gains tax on the transfer of shares or interests in land-holding companies would be levied at 20% of the value of the transaction.
• The list of authorized dealers for gold would be expanded to include financial institutions.

Read a November 2025 report prepared by the KPMG member firm in Zimbabwe