The Minister of Finance and Economic Development, Professor Mthuli Ncube has clarified that the 2 cents per dollar tax, will apply only on transactions of $10 and above.

In the 2018 Mid-Term Monetary Policy on Monday, Reserve Bank of Zimbabwe (RBZ) Governor, Dr John Mangudya announced a review of the Intermediated Money Transfer Tax from the current 5 cents per transaction to 2 cents per every dollar transacted.

However, in a statement today Minister Ncube revealed further details pertaining to the tax.

“Transactions below $10 will be exempt from this tax. There is a cap of $10 000 on the amount of tax to be paid. This implies that transfers above $500,000 will attract a flat tax of $10,000,” he said.

The Minister also specified transactions that will be exempted from the proposed tax.

These are:

  • Intra-company transfer of Funds including transfer from intermediary accounts;
  • Transfer of funds on purchase and sale of equities;
  • Transfer of funds on purchase and redemption of money market instruments;
  • Transfer of funds for payment of salaries;
  • Transfer of funds for payment of taxes;
  • Transfer of funds to intermediary accounts, for example, conveyancers;
  • Transfer of funds in respect of foreign currency related payments; and
  • Transfer of funds by Government.

This tax review comes into effect on the date of gazette of the relevant regulations.