Mobile Transaction Tax In Effect in Zimbabwe
January 8, 2014 Taxation in Zimbabwe
HARARE – Many everyday payments in Zimbabwe will now be liable for an extra 5 percent tax, as a new levy is applied to all mobile money transactions in the country.
Last week, starting from January 1st, a new tax on mobile money transactions came into effect in Zimbabwe, levying ZWD 0.05 charge on all transactions through such systems.
The new tax is intended to bring the tax treatment of mobile transfer systems in line with the current tax treatment of ATM and bank withdrawals.
According to some experts, the tax was put in place due to pressure from the country’s banking sector, which saw the rising popularity of mobile transactions services as a threat to commercial appeal of traditional banking products.
However, some other experts have suggested that the tax is a means for the government to raise extra tax revenues.
Currently several million people make use of mobile transaction payment platforms in Zimbabwe, with customers regularly utilizing the services for bill payments, salaries, and other everyday payments.
The government does not yet have any firm estimates on how much extra revenues will be collected from the new tax, but according to estimates from June last year, well over ZWD 200 million is passed through such services each month, leading to revenues of ZWD 10 million.
Photo by: Dominik Syka