Govt directs corporates to pay 50% forex income tax obligation in local currency

In a move meant to promote the use of the local currency, government has directed corporates to pay 50% of their income tax second quarter Quarterly Payment Date (QPD) in local currency.

The Ministry of Finance and Economic Development advised the public in statement.

“In this regard and to further promote the use of the Zimbabwe dollar in the economy, Government will, for the June 2023 Quarterly Payment Date (QPD), require taxpayers to settle 50% of the foreign currency portion of their corporate tax obligations in local currency”, read the statement.

The ministry reminded companies without adequate Zimbabwe dollars to approach the Reserve Bank of Zimbabwe (RBZ) through their banks to facilitate disposal of their USD holdings in order to access the local currency.

Corporates were discouraged from sourcing funds at the illegal parallel market as they risk facing serious sanctions and penalties by the Financial Intelligence Unit of the apex bank.

The move by the government will free up foreign currency for companies to direct towards other needs.

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