In a move aimed at supporting the transition to the new Zimbabwe Gold (ZIG) currency, Finance and Economic Development Minister Mthuli Ncube has announced more flexible guidelines for the payment of corporate income tax.
In a statement, Ncube said companies will now be able to pay their 2024 second quarter corporate income tax obligations on a 50/50 basis using both the local ZIG currency and foreign currency. This represents a departure from the previous requirement for tax payments to align with a company’s currency of trade.
“The more stable economic environment ushered in by the new Zimbabwe Gold currency has had a positive impact on the economy,” he said.
“Against this background, coupled with the need to maintain this positive economic trajectory, Treasury is stepping up to complement the Fiscal and Monetary Policy Framework aimed at further anchoring the currency, exchange rate and price stability.”
He said the move is part of a broader review of the tax payment framework as the country continues its transition away from the United States dollar.
Ncube noted that the government is working to realign legislative requirements where the currency of trade is specified, as well as set new ratios for local versus foreign currency transactions.
“Cognisant of the above, I wish to advise that payment of Corporate Income Tax should be guided by the provisions of Section 4A of the Finance Act [Cap 23:04], which provides for payment of tax in the equivalent proportion of the currency of trade,” he said.
The new 50/50 payment option for the second quarter corporate tax is intended to minimize economic shocks during the transition period.
Ncube also announced that businesses and the public will have the option to pay government fees and charges in ZIG, with customs duties on non-essential or luxury imports remaining payable in foreign currency.
The changes underscore Zimbabwe’s efforts to cement the role of the ZiG as the country’s primary currency while providing flexibility for businesses as the economic transformation continues.
