Income Tax (Amendment) Bill No. 9 of 2025
- Name of the Bill as appearing on the Order Paper:
The Income Tax (Amendment) Bill,2025
- The Stage of the Bill:
Second Reading
- Summary of What the Bill Proposes to Do
The purpose of the Bill is to amend the Income Tax Act, Chapter 323 of the Laws of Zambia, to strengthen the country's revenue collection mechanisms and address challenges related to tax avoidance.
The proposed legislation makes three principal changes. Firstly, it increases the rate of withholding tax applicable to Government securities. Specifically, the tax rate on interest earned from Treasury Bills and Government bonds will rise from fifteen percent to twenty percent. This change also applies to interest payments made to non-residents, which will now be taxed at the same twenty percent rate.
Secondly, the Bill introduces Minimum Alternative Tax, which will be payable by individuals and partnerships whose overall income tax liabilities may be reduced through various deductions or exemptions. Under the proposed amendment, such taxpayers will be required to pay a minimum tax amount calculated at the rate of one percent per annum on their total turnover.
The Minimum Alternative Tax will be applicable in addition to the maximum income tax ordinarily payable. However, the amount paid under this mechanism may be claimed as a credit against the taxpayer’s total tax liability in the same charge year. If the credit is not fully utilised, it may be carried forward for up to five subsequent charge years. This provision will not apply to taxpayers who are already subject to presumptive tax or turnover tax under the Income Tax Act. The Minister responsible will be empowered to make regulations regarding the administration, assessment, collection, and recovery of this new tax.
To implement these changes, the Bill also amends the Charging Schedule to the Income Tax Act. This includes the deletion and substitution of certain items to reflect the revised withholding tax rates, the insertion of new items to accommodate the Minimum Alternative Tax, and the renumbering of the affected provisions to maintain structural coherence within the legislation.
- When the Bill has been Gazetted as an Act of Parliament:
[To be updated when the Act is gazetted]
- Contacts for submission of Comments: Email the National Assembly or Visit the National Assembly Submission Portal