Zambian government denies introducing new property tax

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Zambia’s revenue collection agency has denied insinuation that it has introduced a new tax on property owners as part of government efforts to collect revenue following its decision to reverse a controversial mineral royalty tax regime. tax
The controversial mineral royalty tax, which was rejected by mining firms, saw the mineral tax increased from 6 percent to 8 percent for underground mines and to 20 percent for open cast mines.
On April 28, the Zambia Revenue Authority (ZRA) sent out Short Message Services (SMSs) to all property owners to notify them that they should start paying 10 percent withholding tax on the income they collect from renting their properties.
However, the announcement has received wide condemnation from a cross section of society, with some accusing the government of trying to strangle citizens with more taxes after failing to collect revenue from the mines.
But Berlin Msiska, the head of the revenue agency said the withholding tax on rental income was not a new tax, adding that it has been misunderstood by some sections of society.
He said in a statement that withholding tax on rental income had been in effect since the 1970s and was also applicable on interest, commissions, dividends and management consultancy fees.
The official said the rate of withholding tax on rental income was reduced from 15 to 10 percent last year, adding that the agency has started providing educational information to stakeholders on the tax.
Last week, Chief Government Spokesperson Chishimba Kambwili advised property owners to start paying the 10 percent withholding tax on rentals because it was law.
He said the law requiring property owners to pay withhold tax has always been there and that the current administration was just implementing it in order to help it raise funds to financing development project. Enditem

-Xinhua,

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