What is VAT in Zimbabwe?
Value Added Tax (VAT) is a consumption tax charged on the supply of goods and services in Zimbabwe. The standard rate is 15%. VAT was introduced in 2004 to replace the older sales tax, and it is administered by the Zimbabwe Revenue Authority (ZIMRA).
VAT is charged at each stage of the supply chain. Registered operators collect VAT from their customers on behalf of ZIMRA and can reclaim the VAT they paid on qualifying business purchases as an input tax credit. The final consumer ultimately bears the cost.
USD and ZiG: which currency for VAT?
Zimbabwe has used the US dollar (USD) as its dominant transactional currency since dollarisation in 2009. In April 2024 the country introduced a new currency, the Zimbabwe Gold (ZiG). In practice, a large share of business — and therefore VAT accounting — is still conducted in USD, though VAT can be accounted for in either currency depending on how a transaction is invoiced. The calculator on this page defaults to USD because that is what most businesses use, with ZiG available as an option.
VAT registration with ZIMRA
A business must register for VAT with ZIMRA once its taxable turnover reaches USD 40,000 in any 12-month period. Once registered, an operator charges VAT on taxable supplies, issues tax invoices, files VAT returns, and remits the tax to ZIMRA.
Registered operators generally file monthly VAT returns. Smaller registered operators may be assigned a quarterly filing category. Returns and payments are submitted through ZIMRA's systems.
Zero-rated and exempt supplies
Not all goods and services attract 15% VAT. Zero-rated supplies (0% VAT charged, input tax credits still claimable):
- Exported goods and services
- Basic foodstuffs: bread, milk, salt, sugar, cooking oil, and flour
- Agricultural inputs
- Educational materials
VAT-exempt supplies (no VAT charged, no input tax credit):
- Financial services
- Residential rental accommodation
How to calculate 15% VAT in Zimbabwe
To add VAT to a net price:
- VAT amount = Net price × 0.15
- Total (inc. VAT) = Net price × 1.15
- Example: $100 (ex. VAT) → Total = $100 × 1.15 = $115. VAT = $15.
- Example: $500 (ex. VAT) → Total = $575. VAT = $75.
- Example: $2,000 (ex. VAT) → Total = $2,300. VAT = $300.
To remove VAT from a gross price (reverse VAT):
- Net price = Gross price ÷ 1.15
- VAT amount = Gross price − Net price
- Example: $575 (inc. VAT) → Net = $575 ÷ 1.15 = $500. VAT = $75.