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ZERO-rated supplies are supplies of goods and services which attract Value Added Tax (VAT) at a rate of 0 percent. These goods include basic food commodities such as mealie meal, sugar, milk, meat, salt and bread. A registered operator who supplies zero-rated goods or services can claim input tax credit in relation to that supply.

Exempt supplies are supplies of goods and services that are not subject to VAT Value Added Tax incurred on goods and services acquired to make exempt supplies shall not be claimed as input tax credit. Traders who exclusively provide exempt supplies are, therefore, not required to be registered for VAT purposes.

The list of exempt products includes basic necessities such as medical and educational services, rentals from residential properties, transport of fare-paying passengers, water for domestic use, electricity for domestic use and fuel.

Statutory Instrument 9 of 2016 (Value Added Tax [Amendment] Regulations, 2016 [No. 40]) was gazetted with effect from February 1, 2016 in order to streamline and reduce the number of zero rated items. Following the amendment, the items in the tables below are now exempt in addition to those that were already on the list prior to the amendment.

All operators who now exclusively supply exempt goods and services as a result of this amendment should now apply for deregistration.

Our valued clients are advised that the commodity codes in the revised schedules are based on the HS2012 codes. The current Value

Added Tax (General) Regulations, SI 273 of 2003 are being reviewed to upgrade the commodity codes therein from HS2007 to HS2012 and will be published in due course.

Reminder
Pay As You Earn (PAYE) for the month of February 2016 is due on 10 March 2016.

To contact ZIMRA:
Visit our website:                www. zimra.co.zw
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Call us (Head Office):          04 –758891/5; 790813; 790814; 781345; 751624; 752731