VAT is a transaction tax on the supply of taxable goods and services. In Zimbabwe, it is levied on every taxable supply by a registered person. The standard VAT rate was returned to 15% in the 2023 Budget, after being cut to 14.5% at the start of 2020 due to the COVID-19 pandemic. This increase impacts both consumers and suppliers, as it raises consumer prices and translates to higher costs for businesses. The increase in VAT rates also causes ripple effects in the market prices of goods and services, resulting in lower demand and sales revenues for suppliers. Overall, the return of the VAT rate to 15% will have a significant impact on Zimbabwe’s economy.
Source Mondaq
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