By Dennis Ndlovu | Zim GBC News
Local users of foreign‑based digital services are now paying a 15 percent Digital Services Withholding Tax, which came into effect last week. The new tax is part of a government initiative to bring income earned by non‑resident digital companies including subscription streaming platforms, satellite internet providers, and other offshore online services into Zimbabwe’s tax net.
The newly introduced digital services tax, enacted through the Finance Act signed into law on Monday, aims to curb revenue losses resulting from the fast-growing digital economy. Many offshore platforms earn substantial income from Zimbabwean consumers despite lacking a physical presence in the country. This tax seeks to ensure that such foreign service providers contribute to the national tax base.
Under the new arrangement, the 15% levy is withheld at the point of payment by banks, mobile money operators, and other licensed financial intermediaries, then remitted to the Zimbabwe Revenue Authority (ZIMRA). Finance Minister Professor Mthuli Ncube stated the measure was crucial to protecting Zimbabwe’s taxing rights and ensuring equity in the system, as digital service payments often escape both VAT and income tax when sent abroad.
Under the revised tax regime, service providers operating outside the country are required to withhold the levy on payments made by local users and remit it to the Zimbabwe Revenue Authority (ZIMRA). The move is intended to expand the domestic tax base and ensure revenues from the booming digital economy are captured.
However, the introduction of the tax has sparked discontent among some consumers in Bulawayo, who argue that it unfairly targets everyday users already struggling with the rising cost of living.
“This is just another way of squeezing money out of ordinary people,” said Nomsa Dube, a Bulawayo resident.
“I already pay for my streaming subscriptions now I have to pay extra just because the service is foreign? It doesn’t seem fair at all.”
Aleck mudiwa expressed concern that the tax could discourage digital adoption and push users to unsafe alternatives.
“People will try to find ways to avoid this tax, maybe using unregulated platforms or VPNs. Instead of helping the economy, this might push users into risky online spaces,” he said.
Critics, however, maintain that the timing of the tax is poor, given broader economic pressures and limited consumer income.
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